[Congressional Record Volume 153, Number 178 (Friday, November 16, 2007)]
[Senate]
[Pages S14627-S14643]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
By Mr. ROBERTS:
S. 2378. A bill to authorize the voluntary purchase of certain
properties in Treece, Kansas, endangered by the Cherokee County
National Priorities List Site, and for other purposes; to the Committee
on Environment and Public Works.
Mr. ROBERTS. Mr. President, I rise today to offer legislation to
protect the residents of Treece, Kansas from the potential danger of
remaining in an area that is undergoing a Superfund cleanup. I commend
my fellow Kansas colleague, Congresswoman Nancy Boyda, for introducing
similar legislation in the House.
Treece is located in Cherokee County, Kansas. The Cherokee County
site encompasses 115 square miles of former mining area. Mining in this
area dates back to the early 1900s and at one time contained the
richest lead and zinc ore production in the world. Although the
drilling stopped in 1970, the effects of over 60 years of mining can be
seen for miles around with mountains of milling left behind. Below
these mountains, and surrounding areas, are enormous holes large enough
to fit a football stadium, and they continually threaten the everyday
safety of the residents of this community.
Cherokee County is part of a larger area known as the Tri-State
Mining District that encompasses cities in southeastern Kansas,
southwestern Missouri and northeastern Oklahoma. Within the Tri-State
Mining District are two towns of particular importance, Treece, Kansas
and Picher, Oklahoma. While these two towns are separated by a State
line they are only a mere two miles away from one another. These two
communities share more than a State line; they share a major highway,
local stores, and most importantly the concerns of the aftermath of
over 60 years of mining on their health, safety and the ultimate
survival of their towns.
Currently Picher, part of the Tar Creek Superfund site, is undergoing
a Federal buyout. The residents of Treece rely heavily on the services
provided to them by Picher. Without that support the economic stability
and ultimate survival of their town is in danger. Therefore, in order
to assist the residents of Treece, I offer this legislation today to
authorize the Environmental Protection Agency to make available to the
state of Kansas $6,000,000, in 2009. This money will be used for the
voluntary purchase of certain properties in Treece and will also allow
for the relocation of community residents. This legislation will
provide the residents of Treece an opportunity to relocate to another
town of their choosing. An opportunity that they may not have without
the Environmental Protection Agency's assistance.
______
By Mr. SALAZAR:
S. 2384. A bill to authorize the Chief of Engineers to conduct a
feasibility study relating to the construction of a multipurpose
project in the Fountain
[[Page S14628]]
Creek watershed located in the State of Colorado; to the Committee on
Environment and Public Works.
Mr. SALAZAR. Mr. President, today I am introducing the Fountain Creek
Feasibility Study Act of 2007. This bill is an important piece of a
larger vision to transform and restore the Fountain Creek watershed,
which lies in the Arkansas River Valley between the cities of Pueblo
and Colorado Springs in my State of Colorado.
The Fountain Creek watershed is a major tributary to the Arkansas
River and is home to a wide variety of plants and wildlife. Anyone who
has traveled the 1-25 corridor between Colorado Springs and Pueblo can
attest to the natural beauty of this region. The watershed itself
comprises 927 square miles, but the impact of its waterflow extends far
beyond its strict boundaries. According to the 2000 census, more than
500,000 people live in the watershed's boundaries. Water from the
watershed serves municipal, industrial and agricultural uses. Creeks
within the watershed contribute about 15 percent of the drinking water
for Colorado Springs and are a source of irrigation for over 100 farms
and ranches. The fertile farmland there produces wheat, com, hay, oats,
and vegetable crops; there are also many working livestock ranches
along Fountain Creek.
Today there are major problems with Fountain Creek. In recent years,
instead of serving as an important link for commerce and recreation,
the Fountain has divided the area. Decades of neglect, increased
waterflows in the Fountain as a result of major urban development in
the north half of the watershed, increased stormwater discharges, and
sewage spills have all harmed the region. The watershed is subject to
frequent flood damage, erosion, and sedimentation. In 1999 a major
flood caused millions of dollars of damage to public and private
property, and destroyed the foundations of numerous homes and roads.
Indeed, just this spring there was minor flooding from the Fountain in
the Pueblo area. Farmers and ranchers near the downstream end of the
watershed in particular have suffered substantial losses of productive
farmland. Degradation of the water quality and thus aquatic and wetland
habitats is accelerating due to wastewater spills, loss of natural
vegetation, and high water volume. Simply put, Fountain Creek
watershed's ecological conditions are unstable and under constant
threat.
This bill is a foundation stone for the idea of restoring Fountain
Creek and turning the corridor between Colorado Springs and Pueblo into
an environmental, agricultural, and recreational ``crown jewel'' for my
State.
This bill would task the Army Corps of Engineers to conduct a study
of the feasibility of constructing one or more dams and reservoirs to
provide more reliable flood and sediment control, to conserve fish and
wildlife and preserve their ecosystem, and to improve the water quality
throughout the watershed. The Corps' expertise and experience will be
critical to determining the options for restoring the health and
stability of the Fountain Creek watershed.
The idea of such a multipurpose project on the Fountain is not new.
It was first proposed in 1970 by the U.S. Army Corps of Engineers after
the 1965 flood that inundated communities along the Fountain Creek,
including particularly the city of Pueblo. The proposal was supported
by the States of Colorado and Kansas and local officials, and was even
the preferred option of the Army Corps for addressing flooding in the
Fountain. I believe a similar proposal should be evaluated again, in
light of changed conditions and increased flows in Fountain Creek
resulting from urban development in the Colorado Springs metro area.
Because the Fountain contributes a significant amount of water to the
Arkansas River Valley below the confluence of the Fountain Creek and
Arkansas River in Pueblo, this project may very well help address the
various concerns of residents and communities of the Arkansas River
Valley from Pueblo to the Kansas State line.
Last year I laid out a vision to revitalize Fountain Creek and
connect the communities along its bank in a regional project. My plan
involves the cleanup and revitalization of Fountain Creek; creating a
linear state park along the river corridor with camping facilities,
hundreds of miles of new trails, restored wildlife and natural habitat
and new flat water recreation opportunities; protecting farms and
ranches along the creek and in the lower Arkansas Valley; and ensuring
a greenbelt separator between the communities of Colorado Springs and
Pueblo.
My vision is to restore and transform this vital watershed. I hope
that all levels of Government can work together to bring unmatched
recreational opportunities, create an environment for plants and
wildlife to flourish, ensure that agricultural lands remain productive,
and address the flood control and water quality issues on Fountain
Creek. This bill is an essential step towards achieving this goal.
______
By Mrs. FEINSTEIN (for herself and Mrs. BOXER):
S. 2386. A bill to amend the Robert T. Stafford Disaster Relief and
Emergency Assistance Act, to authorize temporary mortgage and rental
payments; to the Committee on Homeland Security and Governmental
Affairs.
Mrs. FEINSTEIN. Mr. President. I rise today to introduce a series of
bills, S. 2386, S. 2387, S. 2388, and S. 2390, designed to better
prepare for catastrophic wildfires like the ones that recently
devastated Southern California.
The Nation watched as these fires swept, uncontrolled, through
several counties.
They caused the evacuation of an estimated 750,000 people--the
largest evacuation in California history.
They burned more than 500,000 acres. Destroyed more than 2,000 homes.
Killed 10 people. Injured 130.
The financial damage is estimated in the billions.
Simply put: This was a major disaster.
It was not the first. Southern California suffered similar wildfire
losses just 4 years ago.
We must face the fact that catastrophic wildfires are in California's
future, and the future of other states.
California is tinder-dry. Global warming is real, leading to extended
droughts and longer fire seasons.
Fires are larger, and they burn hotter and with more intensity.
More and more people are living in areas at high risk of wildfire.
There are more than 5 million homes in California alone in this high-
threat ``wildland-urban interface.''
Across the rest of the country, there are nearly 40 million more
homes in the wildland-urban interface.
So the question comes: What can be done?
There is no doubt that we cannot fully eliminate wildfires.
But I believe we can take steps now to better protect communities, to
improve firefighting capabilities, and to improve relief and recovery
aid.
The four bills introduced today will get this process started. They
are the Fire Safe Community Act, which would establish new incentives
for communities at risk of wildfires to adopt a new model Fire Safe
ordinance; the Mortgage and Rental Disaster Relief Act, to make sure
that qualified individuals, displaced by major disasters, can make
their mortgage and rental payments; the Disaster Rebuilding Assistance
Act, to increase the amount of Federal dollars available to homeowners
whose rebuilding costs outstrip their insurance coverage; and the
Managing Arson Through Criminal History, MATCH, Act, requiring states
to create registries of convicted arsonists.
Let me go into greater detail on each of these bills.
Fire Safe Community Act
This bill will help protect our communities from the catastrophic
effects of wildfires.
Most importantly, it does three key things: it instructs the National
Institute of Standards and Technology to develop a model ordinance that
will serve as a baseline for communities seeking to protect their homes
and property from wildfire; it encourages local participation by
allowing for greater Federal reimbursement of firefighting costs in
communities that adopt the model ordinance; and it creates a grant
program to encourage responsible development practices that meet model
guidelines in the wildland-urban interface.
In effect, the Federal Government would become the partner to local
governments as they seek to make their communities fire-safe.
As I have said, we can never stop wildfires. But we can take
important
[[Page S14629]]
steps to make these fires less destructive.
This bill starts with the first step of creating a model ``Fire
Safe'' ordinance--with clear, unambiguous language that sets a national
standard for how to address all aspects of fire threat.
The National Institute of Standards and Technology would provide this
standard guideline for communities, in conjunction with the U.S. Forest
Service, the Bureau of Land Management, and the U.S. Fire
Administration.
States are also encouraged to adopt model ordinances tailored to the
needs of their own communities for fire-safe development.
These guidelines will address water supply, construction materials
and techniques, defensible space, vegetation management, and
infrastructure standards.
The next step is to put this model ordinance to use.
The bill authorizes a $25 million per year grant program,
administered by the Federal Emergency Management Agency's Office of
Grants and Training.
It will help communities implement these standards, and bring the
safest development practices to their neighborhoods.
This grant program will be available to local governments located in
the wildlife-urban interface, and to high-threat regions that have
adopted--or plan to adopt--the model ordinance.
They will have the option of adopting either the federal model
ordinance, or one produced by their own state.
As further incentive, this bill would improve Fire Management
Assistance Grants to communities adopting a model ordinance.
Today under the Fire Management Assistance Grant program, the Federal
Government covers 75 percent of the cost of fighting wildfires.
Under this bill, communities adopting a model ordinance would be
eligible for federal reimbursement of up to 90 percent of their
firefighting costs.
The Fire Safe Community Act will also make grants available to States
to help them compile their own fire maps.
The mapping grants will be matched 50-50 by State funds, and will
encourage development of comprehensive fire hazard maps that indicate
the exact locations of high-threat fire areas.
This vital information will aid firefighting efforts at all levels.
It's important to note that the model ordinances at the core of this
bill are not mandatory--they would provide voluntary guidelines that
communities can adopt, or not.
It does not step on the toes of local government. Rather, it would
help all of us reach a common goal.
I come from local government--I'm 9 years a mayor, 9 years a county
supervisor--and I recognize that zoning is the province of local
government.
But we have a real problem here: We know that development in the
wildland-urban interface is accelerating, making fires more costly.
So we need to take steps to improve fire safety in these areas.
This bill is an important step toward becoming better prepared.
Now I want to discuss two bills intended to improve recovery aid
after disaster strikes.
Mortgage and Rental Disaster Relief Act
This bill will provide much-needed relief to families hit hard by
disaster--including people displaced by the recent fires.
It would authorize FEMA to make mortgage and rental assistance
available for qualified individuals in communities designated by the
President as disaster areas.
It is based on an important point: While catastrophic wildfires and
other disasters can destroy homes, they don't relieve people of the
financial obligations that come with home ownership or lease
agreements.
In most cases, these payments must still be made, even if the
residence has been wiped out.
This burden is too much for many families. They incur additional
expenses--such as hotel or lodging costs--that come with being
displaced following a major disaster.
FEMA used to provide mortgage and rental assistance. But it was
eliminated by the Disaster Mitigation Act of 2000.
This bill would reauthorize the program, and make several changes to
ensure that assistance is provided only to those most in need.
First, to qualify for assistance applicants must demonstrate that
they face significant economic hardships and suffered disaster-related
income loss.
The disaster-related income loss must fit into one of the following
categories: Your employer, or your own business, must be located in the
area declared a major disaster by the President; you lose your job
because your employer or business has a significant business
relationship with a company located within the Presidentially declared
disaster area; or you live in a Presidentially declared disaster area,
and have suffered financially due to travel restrictions and road
closures post-disaster.
To qualify for this aid, applicants must also provide proof that
their employment was discontinued as a result of disaster.
They must also show imminent delinquency, eviction, dispossession, or
foreclosure.
Finally, this assistance is available only for up to 18 months, and
is subject to income caps.
Only households with adjusted gross incomes of $100,000 or less, in
high-cost States such as California, would be eligible.
Households in lower-cost States could be eligible if their annual
adjusted gross incomes do not exceed $75,000.
disaster rebuilding assistance act
This second disaster relief bill would increase the amount of money
FEMA can provide--for rebuilding and temporary housing--in high-cost
States such as California.
It is designed to help disaster victims whose rebuilding costs exceed
their insurance coverage.
Sadly, many Californians hit by the wildfires are now learning that
their insurance coverage was insufficient.
This is a real problem in California; in fact, California Insurance
Commissioner Steve Poizner estimates that as many as 25 percent of the
victims of the recent fires may be underinsured.
Let me be clear: This bill will not cover the full costs of
rebuilding.
But it will help close the gap, for qualified households in areas
declared by the President to be disaster areas.
Today, FEMA can provide up to roughly $28,000 to individuals and
households whose rebuilding costs exceed their insurance coverage.
This assistance can be used for rebuilding costs, as well as
temporary housing.
This bill would increase this amount to $50,000.
The legislation also gives the President the discretion to increase
this cap, if necessary, to cover rebuilding expenses in high-cost
States.
I believe this bill will provide an important step toward giving
Americans the chance they need to rebuild their lives after suffering
through a major disaster.
The last bill in this package takes aim at criminal arsonists.
managing arson through criminal history act
This bill--also known as the MATCH Act--is the Senate version of a
bill introduced in the House by California Representatives Mary Bono
and Adam Schiff.
It would establish Federal and State arson registries; require
convicted arsonists to register and update certain specified
information for 5 years after a first conviction, 10 years after a
second conviction, and for life after a third conviction; and authorize
grants and incentives so that these registries will be operational
within 3 years.
It is important that we improve our ability to keep track of
arsonists, because it is clear that some of these recent wildfires were
no accident.
The Santiago Fire in Orange County--which burned at least 27,000
acres--has officially been declared an arson fire.
Would-be arsonists tried to start new fires as the wildfires raged.
In San Diego County, authorities arrested an adult and a juvenile
suspected of starting a blaze in Vista.
In San Bernardino, a suspect was charged with setting a brush fire
near Victorville.
There were several arson-related arrests in Los Angeles County--one
suspect died in a gunfight with police.
The arsonist who started the Santiago fire remains at-large.
There is a reward--it now stands at $250,000--but law-enforcement
officials
[[Page S14630]]
say an arrest will likely depend on a tip from the public.
It does not have to be that way.
This bill would give fire investigators and law-enforcement officials
up-to-date information on potential arsonists.
This is common-sense legislation. It will provide a readily
accessible database, and help investigators rule out persons of
interest and zero in on arson suspects.
We owe it to our brave firefighters to give fire investigators this
important new tool, so they can help bring arsonists to justice.
Catastrophic wildfires are not going away. In fact, the evidence
strongly suggests they will occur with greater frequency and ferocity.
But we can take important steps--now--to make our communities safer.
To strengthen our firefighting capabilities.
To ensure that more relief and recovery aid is provided to victims,
so they can get back on their feet as soon as possible.
These bills are not a panacea. But they are an important first step.
I urge my colleagues to vote for them.
______
By Mr. REED:
S. 2391. A bill to provide for affordable housing relief, and for
other purposes; to the Committee on Banking, Housing, and Urban
Affairs.
Mr. REED Mr. President, today I introduce the Government Sponsored
Enterprise Mission Improvement Act of 2007. This bill would amend the
Housing and Community Development Act of 1992 to dramatically
strengthen the affordable housing mission of Fannie Mae and Freddie
Mac. I believe that deepening Fannie and Freddie's responsibilities
towards affordable housing must be a part of any type of GSE reform
that we undertake in the Senate.
The problems caused by the shortage in affordable housing are well
publicized. But the impact of the shortage, which most commonly affects
those near the bottom of the income scale, receives less attention.
Worse, there is currently no Federal housing program that increases the
supply of housing affordable to those with the most severe needs. The
bill I am introducing today, the Government Sponsored Enterprise
Mission Improvement Act, would provide $500 to $900 million per year in
funding to help those with worst case housing needs.
Across the U.S., the 17 million renters and owners with lowest
incomes have by far the most critical housing problems. About three-
fifths of renters and owners with incomes below 30 percent of area
median income pay more than half of their meager incomes for housing.
Families must pay such excessive amounts because there are too few
affordable units. Nationally, according to HUD's analysis of 2005
American Housing Survey data, there were 10 million renters with
incomes below 30 percent of area median income in 2005, but only 6.7
million units with rents affordable to those with such incomes.
This bill I am introducing today would require Fannie Mae and Freddie
Mac to set aside 4.2 basis points on each dollar of unpaid principle
balance of total new business purchases for an Affordable Housing
Program.
Sixty-five percent of this set-aside would go towards an Affordable
Housing Block Grant Program. This program would be managed by the
Secretary of Housing and Urban Development and in the first year after
enactment, would be allocated to the states by formula grant to help
address the current subprime mortgage crisis. These grants could be
used to facilitate loan modification and refinance options for low- and
moderate-income borrowers facing foreclosure. Some of the funding could
also be used to help low- and moderate-income homebuyers purchase
properties that have been foreclosed upon to help stabilize
neighborhoods.
After 2008, the funding would be distributed by formula grants to the
states for the development, construction, and preservation of housing
for very low- and extremely low-income families. This funding would
complement other Federal and State programs, such as the HOME
Investment Partnerships and Low-Income Housing Tax Credit programs, to
bring down costs enough to primarily target the income group most
needing housing that is truly affordable to them, extremely low-income
renters.
The other 35 percent of this set-aside would be allocated for a
Capital Magnet Fund managed by the Secretary of the Treasury. This
funding would go out through competitive grants for financial
activities that leverage affordable housing development, construction
and preservation for low-, very low-, and extremely low-income
families. It could also be used for economic development activities or
community service facilities, such as day care centers and health care
clinics, that in conjunction with affordable housing activities
implement a concerted strategy to stabilize or revitalize a low-income
community or underserved rural area.
The Government Sponsored Enterprise Mission Improvement Act also
would strengthen Fannie and Freddie's Affordable Housing Goals. In
particular, it would align their goals with current Community
Reinvestment Act income targeting definitions, which I believe should
help the lower end of the conventional market become more liquid.
Finally, this legislation would create a new statutory duty for
Fannie Mae and Freddie Mac to serve ``underserved markets'' that lack
adequate credit through conventional lending sources such as
Manufactured Housing; Affordable Housing Preservation; Subprime
Borrowers; Community Development Financial Institutions; and Rural
Housing. I give teeth to this provision by making compliance with this
duty subject to Section 1336 enforcement provisions.
I urge my colleagues to cosponsor this legislation and to help make
it an integral part of any GSE reform that is taken up by the Senate.
This bill makes it clear that with Fannie and Freddie's Government
benefits come many important responsibilities.
Mr. President, I ask unanimous consent that the text of the bill be
printed in the Record.
There being no objection, the text of the bill was ordered to be
printed in the Record.
S. 2391
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Government
Sponsored Enterprise Mission Improvement Act'' or the ``GSE
Mission Improvement Act''.
(b) Table of Contents.--The table of contents for this Act
is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Annual housing report regarding enterprises.
Sec. 3. Public use database.
Sec. 4. Revision of housing goals.
Sec. 5. Duty to serve underserved markets.
Sec. 6. Monitoring and enforcing compliance with housing goals.
Sec. 7. Affordable housing programs.
Sec. 8. Enforcement.
SEC. 2. ANNUAL HOUSING REPORT REGARDING ENTERPRISES.
(a) Repeal.--Section 1324 of the Housing and Community
Development Act of 1992 (12 U.S.C. 4544) is hereby repealed.
(b) Annual Housing Report.--The Housing and Community
Development Act of 1992 is amended by inserting after section
1323 the following:
``SEC. 1324. ANNUAL HOUSING REPORT REGARDING ENTERPRISES.
``(a) In General.--After reviewing and analyzing the
reports submitted under section 309(n) of the Federal
National Mortgage Association Charter Act and section 307(f)
of the Federal Home Loan Mortgage Corporation Act, the
Secretary shall submit a report, not later than October 30 of
each year, to the Committee on Banking, Housing, and Urban
Affairs of the Senate and the Committee on Financial Services
of the House of Representatives, on the activities of each
enterprise.
``(b) Contents.--The report required under subsection (a)
shall--
``(1) discuss--
``(A) the extent to and manner in which--
``(i) each enterprise is achieving the annual housing goals
established under subpart B;
``(ii) each enterprise is complying with its duty to serve
underserved markets, as established under section 1335;
``(iii) each enterprise is complying with section 1337; and
``(iv) each enterprise is achieving the purposes of the
enterprise established by law; and
``(B) the actions that each enterprise could undertake to
promote and expand the purposes of the enterprise;
``(2) aggregate and analyze relevant data on income to
assess the compliance of each enterprise with the housing
goals established under subpart B;
``(3) aggregate and analyze data on income, race, and
gender by census tract and other
[[Page S14631]]
relevant classifications, and compare such data with larger
demographic, housing, and economic trends;
``(4) identify the extent to which each enterprise is
involved in mortgage purchases and secondary market
activities involving subprime loans; and
``(5) compare the characteristics of subprime loans
purchased and securitized by each enterprise to other loans
purchased and securitized by each enterprise.
``(c) Data Collection and Reporting.--
``(1) In general.--To assist the Secretary in analyzing the
matters described in subsection (b), the Secretary shall
conduct, on a monthly basis, a survey of mortgage markets in
accordance with this subsection.
``(2) Data points.--Each monthly survey conducted by the
Secretary under paragraph (1) shall collect data on--
``(A) the characteristics of individual mortgages that are
eligible for purchase by the enterprises and the
characteristics of individual mortgages that are not eligible
for purchase by the enterprises including, in both cases,
information concerning--
``(i) the price of the house that secures the mortgage;
``(ii) the loan-to-value ratio of the mortgage, which shall
reflect any secondary liens on the relevant property;
``(iii) the terms of the mortgage;
``(iv) the creditworthiness of the borrower or borrowers;
and
``(v) whether the mortgage, in the case of a conforming
mortgage, was purchased by an enterprise;
``(B) the characteristics of individual subprime mortgages
that are eligible for purchase by the enterprises and the
characteristics of borrowers under such mortgages, including
the credit worthiness of such borrowers and determination
whether such borrowers would qualify for prime lending; and
``(C) such other matters as the Secretary determines to be
appropriate.
``(3) Public availability.--The Secretary shall make any
data collected by the Secretary in connection with the
conduct of a monthly survey available to the public in a
timely manner, provided that the Secretary may modify the
data released to the public to ensure that the data--
``(A) is not released in an identifiable form; and
``(B) is not otherwise obtainable from other publicly
available data sets.
``(4) Definition.--For purposes of this subsection, the
term `identifiable form' means any representation of
information that permits the identity of a borrower to which
the information relates to be reasonably inferred by either
direct or indirect means.''.
SEC. 3. PUBLIC USE DATABASE.
Section 1323 of the Housing and Community Development Act
of 1992 (42 U.S.C. 4543) is amended--
(1) in subsection (a)--
(A) by striking ``(a) In General.--The Secretary'' and
inserting the following:
``(a) Availability.--
``(1) In general.--The Secretary''; and
(B) by adding at the end the following new paragraph:
``(2) Census tract level reporting.--Such data shall
include the data elements required to be reported under the
Home Mortgage Disclosure Act of 1975, at the census tract
level.'';
(2) in subsection (b)(2), by inserting before the period at
the end the following: ``or with subsection (a)(2)''; and
(3) by adding at the end the following new subsection:
``(d) Timing.--Data submitted under this section by an
enterprise in connection with a provision referred to in
subsection (a) shall be made publicly available in accordance
with this section not later than September 30 of the year
following the year to which the data relates.''.
SEC. 4. REVISION OF HOUSING GOALS.
(a) Repeal.--Sections 1331 through 1334 of the Housing and
Community Development Act of 1992 (12 U.S.C. 4561 through
4564) are hereby repealed.
(b) Housing Goal.--The Housing and Community Development
Act of 1992 is amended by inserting before section 1335 the
following:
``SEC. 1331. ESTABLISHMENT OF HOUSING GOALS.
``(a) In General.--The Secretary shall, by regulation,
establish effective for the first calendar year that begins
after the date of enactment of the Government Sponsored
Enterprise Mission Improvement Act, and each year thereafter,
annual housing goals, as described in sections 1332, 1333,
and 1334, with respect to the mortgage purchases by the
enterprises.
``(b) Special Counting Requirements.--
``(1) In general.--The Secretary shall determine whether an
enterprise shall receive full, partial, or no credit for a
transaction toward achievement of any of the housing goals
established pursuant to this section or sections 1332 through
1334.
``(2) Considerations.--In making any determination under
paragraph (1), the Secretary shall consider whether a
transaction or activity of an enterprise is substantially
equivalent to a mortgage purchase and either (A) creates a
new market, or (B) adds liquidity to an existing market,
provided however that the terms and conditions of such
mortgage purchase is neither determined to be unacceptable,
nor contrary to good lending practices, and otherwise
promotes sustainable homeownership and further, that such
mortgage purchase actually fulfills the purposes of the
enterprise and is in accordance with the chartering Act of
such enterprise.
``(c) Eliminating Interest Rate Disparities.--
``(1) In general.--In establishing and implementing the
housing goals under this subpart, the Secretary shall require
the enterprises to disclose appropriate information to allow
the Secretary to assess if there are any disparities in
interest rates charged on mortgages to borrowers who are
minorities, as compared with borrowers of similar
creditworthiness who are not minorities, as evidenced in
reports pursuant to the Home Mortgage Disclosure Act of 1975.
``(2) Report to congress and remedy required on
disparities.--Upon a finding by the Secretary that a pattern
of disparities in interest rates exists pursuant to the
information provided by an enterprise under paragraph (1),
the Secretary shall--
``(A) forward to the Committee on Banking, Housing, and
Urban Affairs of the Senate and the Committee on Financial
Services of the House of Representatives a report detailing
the disparities; and
``(B) require the enterprise to take such actions as the
Secretary deems appropriate pursuant to this Act, to remedy
such identified interest rate disparities.
``(3) Identity of individuals not disclosed.--In carrying
out this subsection, the Secretary shall ensure that no
personally identifiable financial information that would
enable an individual borrower to be reasonably identified
shall be made public.
``(d) Timing.--The Secretary shall establish an annual
deadline for the establishment of housing goals described in
subsection (a), taking into consideration the need for the
enterprises to reasonably and sufficiently plan their
operations and activities in advance, including operations
and activities necessary to meet such goals.
``SEC. 1331A. DISCRETIONARY ADJUSTMENT OF HOUSING GOALS.
``(a) Authority.--An enterprise may petition the Secretary
in writing at any time during a year to reduce the level of
any goal for such year established pursuant to this subpart.
``(b) Standard for Reduction.--The Secretary may reduce the
level for a goal pursuant to such a petition only if--
``(1) market and economic conditions or the financial
condition of the enterprise require such action; or
``(2) efforts to meet the goal would result in the
constraint of liquidity, over investment in certain market
segments, or other consequences contrary to the intent of
this subpart, section 301(3) of the Federal National Mortgage
Association Charter Act (12 U.S.C. 1716(3)), or section
301(3) of the Federal Home Loan Mortgage Corporation Act (12
U.S.C. 1451 note), as applicable.
``(c) Determination.--
``(1) 30-day period.--The Secretary shall make a
determination regarding any proposed reduction within 30 days
of receipt of the petition regarding the reduction.
``(2) Extension.--The Secretary may extend the period
described in paragraph (1) for a single additional 15-day
period, but only if the Secretary requests additional
information from the enterprise.
``SEC. 1332. SINGLE-FAMILY HOUSING GOALS.
``(a) Establishment of Goals.--
``(1) In general.--The Secretary shall establish annual
goals for the purchase by each enterprise of conventional,
conforming, single-family, owner-occupied, purchase money
mortgages financing housing for each of the following:
``(A) Low-income families.
``(B) Families that reside in low-income areas.
``(C) Very low-income families.
``(2) Goals as percentage of total purchase money mortgage
purchases.--The goals established under paragraph (1) shall
be established as a percentage of the total number of single-
family dwelling units financed by single-family purchase
money mortgages of the enterprise.
``(b) Determination of Compliance.--
``(1) In general.--The Secretary shall determine, for each
year that the housing goals under this section are in effect
pursuant to section 1331(a), whether each enterprise has
complied with the single-family housing goals established
under this section for such year.
``(2) Compliance requirements.--An enterprise shall be
considered to be in compliance with a goal described under
subsection (a) for a year, only if, for each of the types of
families described in subsection (a), the percentage of the
number of conventional, conforming, single-family, owner-
occupied, purchase money mortgages purchased by each
enterprise in such year that serve such families, meets or
exceeds the target established under subsection (c) for the
year for such type of family.
``(c) Annual Targets.--
``(1) In general.--The Secretary shall establish annual
targets for each goal described in subsection (a).
``(2) Considerations.--In establishing annual targets under
paragraph (1), the Secretary shall consider--
``(A) national housing needs;
``(B) economic, housing, and demographic conditions;
``(C) the performance and effort of the enterprises toward
achieving the housing goals under this section in previous
years;
``(D) the ability of the enterprise to lead the industry in
making credit available;
``(E) recent information submitted in compliance with the
Home Mortgage Disclosure
[[Page S14632]]
Act of 1975 and such other mortgage data as may be available
for non metropolitan areas regarding conventional,
conforming, single-family, owner-occupied, purchase money
mortgages originated and purchased;
``(F) the size of the purchase money conventional mortgage
market serving each of the types of families described in
subsection (a), relative to the size of the overall purchase
money mortgage market; and
``(G) the need to maintain the sound financial condition of
the enterprises.
``(d) Notice of Determination and Enterprise Comment.--
``(1) Notice.--Within 30 days of making a determination
under subsection (b) regarding compliance of an enterprise
for a year with the housing goals established under this
section and before any public disclosure thereof, the
Secretary shall provide notice of the determination to the
enterprise, which shall include an analysis and comparison,
by the Secretary, of the performance of the enterprise for
the year and the targets for the year under subsection (c).
``(2) Comment period.--The Secretary shall provide each
enterprise an opportunity to comment on the determination
during the 30-day period beginning upon receipt by the
enterprise of the notice.
``(e) Use of Borrower Income.--In monitoring the
performance of each enterprise pursuant to the housing goals
under this section and evaluating such performance (for
purposes of section 1336), the Secretary shall consider a
mortgagor's income to be the income of the mortgagor at the
time of origination of the mortgage.
``SEC. 1333. SINGLE-FAMILY HOUSING REFINANCE GOALS.
``(a) Prepayment of Existing Loans.--
``(1) In general.--The Secretary shall establish annual
goals for the purchase by each enterprise of mortgages on
conventional, conforming, single-family, owner-occupied
housing given to pay off or prepay an existing loan served by
the same property for each of the following:
``(A) Low-income families.
``(B) Families that reside in low-income areas.
``(C) Very low-income families.
``(2) Goals as percentage of total refinancing mortgage
purchases.--The goals described under paragraph (1) shall be
established as a percentage of the total number of single-
family dwelling units refinanced by mortgage purchases of
each enterprise.
``(b) Determination of Compliance.--
``(1) In general.--The Secretary shall determine, for each
year that the housing goals under this section are in effect
pursuant to section 1331(a), whether each enterprise has
complied with the single-family housing refinance goals
established under this section for such year.
``(2) Compliance.--An enterprise shall be considered to be
in compliance with the goals of this section for a year, only
if, for each of the types of families described in subsection
(a), the percentage of the number of conventional,
conforming, single-family, owner-occupied refinancing
mortgages purchased by each enterprise in such year that
serve such families, meets or exceeds the target for the year
for such type of family that is established under subsection
(c).
``(c) Annual Targets.--
``(1) In general.--The Secretary shall establish annual
targets for each goal described in subsection (a).
``(2) Considerations.--In establishing annual targets under
paragraph (1), the Secretary shall consider--
``(A) national housing needs;
``(B) economic, housing, and demographic conditions;
``(C) the performance and effort of the enterprises toward
achieving the housing goals under this section in previous
years;
``(D) the ability of the enterprise to lead the industry in
making credit available;
``(E) recent information submitted in compliance with the
Home Mortgage Disclosure Act of 1975 and such other mortgage
data as may be available for non metropolitan areas regarding
mortgages on conventional, conforming, single-family, owner-
occupied, refinanced mortgages originated and purchased;
``(F) the size of the refinance conventional mortgage
market serving each of the types of families described in
subsection (a) relative to the size of the overall refinance
conventional mortgage market; and
``(G) the need to maintain the sound financial condition of
the enterprises.
``(d) Notice of Determination and Enterprise Comment.--
``(1) Notice.--Within 30 days of making a determination
under subsection (b) regarding compliance of an enterprise
for a year with the housing goals established under this
section and before any public disclosure thereof, the
Secretary shall provide notice of the determination to the
enterprise, which shall include an analysis and comparison,
by the Secretary, of the performance of the enterprise for
the year and the targets for the year under subsection (c).
``(2) Comment period.--The Secretary shall provide each
enterprise an opportunity to comment on the determination
during the 30-day period beginning upon receipt by the
enterprise of the notice.
``(e) Use of Borrower Income.--In monitoring the
performance of each enterprise pursuant to the housing goals
under this section and evaluating such performance (for
purposes of section 1336), the Secretary shall consider a
mortgagor's income to be the income of the mortgagor at the
time of origination of the mortgage.
``SEC. 1334. MULTIFAMILY SPECIAL AFFORDABLE HOUSING GOAL.
``(a) Establishment.--
``(1) In general.--The Secretary shall establish, by
regulation, by unit or dollar volume, as determined by the
Secretary, an annual goal for the purchase by each enterprise
of:
``(A) Mortgages that finance dwelling units affordable to
very low-income families.
``(B) Mortgages that finance dwelling units assisted by the
low-income housing tax credit under section 42 of the
Internal Revenue Code of 1986.
``(2) Additional requirements for smaller projects.--The
Secretary shall establish additional requirements for the
purchase by each enterprise of mortgages described in
paragraph (1) for multifamily housing projects of a smaller
or limited size, which may be based on the number of dwelling
units in the project or the amount of the mortgage, or both,
and shall include multifamily housing projects of 5 to 50
units (as adjusted by the Secretary), or with mortgages of up
to $5,000,000 (as adjusted by the Secretary).
``(3) Factors.--In establishing the goal under this section
relating to mortgages on multifamily housing for an
enterprise, the Secretary shall consider--
``(A) national multifamily mortgage credit needs;
``(B) the performance and effort of the enterprise in
making mortgage credit available for multifamily housing in
previous years;
``(C) the size of the multifamily mortgage market;
``(D) the most recent information available for the
Residential Survey published by the Census Bureau, and such
other data as may be available regarding multifamily
mortgages;
``(E) the ability of the enterprise to lead the industry in
expanding mortgage credit availability at favorable terms,
especially for underserved markets, such as for--
``(i) small multifamily projects;
``(ii) multifamily properties in need of preservation and
rehabilitation; and
``(iii) multifamily properties located in rural areas; and
``(F) the need to maintain the sound financial condition of
the enterprise.
``(b) Units Financed by Housing Finance Agency Bonds.--The
Secretary may give credit toward the achievement of the
multifamily special affordable housing goal under this
section (for purposes of section 1336) to dwelling units in
multifamily housing that otherwise qualify under such goal
and that is financed by tax-exempt or taxable bonds issued by
a State or local housing finance agency, but only if--
``(1) such bonds are secured by a guarantee of the
enterprise; or
``(2) are not investment grade and are purchased by the
enterprise.
``(c) Use of Tenant Income or Rent.--
``(1) In general.--The Secretary shall monitor the
performance of each enterprise in meeting the goals
established under this section and shall evaluate such
performance (for purposes of section 1336) based on--
``(A) if such data is available, the income of the
prospective or actual tenants of the property; or
``(B) if such data is not available, the rent levels
affordable to low-income and very low-income families.
``(2) Rent level.--A rent level shall be considered to be
affordable for purposes of this subsection for an income
category referred to in this subsection if it does not exceed
30 percent of the maximum income level of such income
category, with appropriate adjustments for unit size as
measured by the number of bedrooms.
``(d) Determination of Compliance.--
``(1) In general.--The Secretary shall, for each year that
the housing goal under this section is in effect pursuant to
section 1331(a), determine whether each enterprise has
complied with such goal and the additional requirements under
subsection (a)(2).
``(2) Compliance.--An enterprise shall be considered to be
in compliance with the goal of this section for a year only
if for each of the properties described in subsection (a),
the percentage of the number of multifamily mortgages
purchased by each enterprise in such year, that serve such
families, meets or exceeds the goals for the year for such
type of properties that are established under subsection (a).
``(e) Consideration of Units in Single-Family Rental
Housing.--In establishing any goal under this section, the
Secretary may take into consideration the number of housing
units financed by any mortgage on single-family rental
housing purchased by an enterprise.''.
(c) Conforming Amendments.--The Housing and Community
Development Act of 1992 is amended--
(1) in section 1335(a) (12 U.S.C. 4565(a)), in the matter
preceding paragraph (1), by striking ``low- and moderate-
income housing goal'' and all that follows through ``section
1334'' and inserting ``housing goals established under this
subpart'';
(2) in section 1336 (12 U.S.C. 4566)--
(A) in section (a)(1), by striking ``sections 1332, 1333,
and 1334,'' and inserting ``this subpart''; and
(B) in subsection (b)(1), by striking ``section 1332, 1333,
or 1334,'' and inserting ``this subpart''.
(d) Definitions.--Section 1303 of the Housing and Community
Development Act of 1992 (12 U.S.C. 4502) is amended--
[[Page S14633]]
(1) in paragraph (19), by striking ``60 percent'' each
place such term appears and inserting ``50 percent''; and
(2) by adding at the end the following:
``(20) Conforming mortgage.--The term `conforming mortgage'
means, with respect to an enterprise, a conventional mortgage
having an original principal obligation that does not exceed
the dollar limitation, in effect at the time of such
origination, under--
``(A) section 302(b)(2) of the Federal National Mortgage
Association Charter Act; or
``(B) section 305(a)(2) of the Federal Home Loan Mortgage
Corporation Act.
``(21) Low-income area.--The term `low-income area' means a
census tract or block numbering area in which the median
income does not exceed 80 percent of the median income for
the area in which such census tract or block numbering area
is located, and, for the purposes of section 1332(a)(2),
shall include families having incomes not greater than 100
percent of the area median income who reside in minority
census tracts.
``(22) Very low-income.--
``(A) In general.--The term `very low-income' means--
``(i) in the case of owner-occupied units, income in excess
of 30 percent but not greater than 50 percent of the area
median income; and
``(ii) in the case of rental units, income in excess of 30
percent but not greater than 50 percent of the area median
income, with adjustments for smaller and larger families, as
determined by the Secretary.
``(B) Rule of construction for purposes of housing goals.--
Notwithstanding subparagraph (A), for purposes of any housing
goal established under sections 1331 through 1334, the term
`very low-income' means--
``(i) in the case of owner-occupied units, families having
incomes not greater than 50 percent of the area median
income;
``(ii) in the case of rental units, families having incomes
not greater than 50 percent of the area median income, with
adjustments for smaller and larger families, as determined by
the Secretary.
``(23) Extremely low-income.--The term `extremely low-
income' means--
``(A) in the case of owner-occupied units, income not in
excess of 30 percent of the area median income; and
``(B) in the case of rental units, income not in excess of
30 percent of the area median income, with adjustments for
smaller and larger families, as determined by the Secretary.
``(24) Shortage of standard rental units both affordable
and available to extremely low-income renter households.--
``(A) In general.--The term `shortage of standard rental
units both affordable and available to extremely low-income
renter households' means the gap between--
``(i) the number of units with complete plumbing and
kitchen facilities with a rent that is 30 percent or less of
30 percent of the adjusted area median income as determined
by the Secretary that are occupied by extremely low-income
renter households or are vacant for rent; and
``(ii) the number of extremely low-income renter
households.
``(B) Rule of construction.--If the number of units
described in subparagraph (A)(i) exceeds the number of
extremely low-income households as described in subparagraph
(A)(ii), there is no shortage.
``(25) Shortage of standard rental units both affordable
and available to very low-income renter households.--
``(A) In general.--The term `shortage of standard rental
units both affordable and available to very low-income renter
households' means the gap between--
``(i) the number of units with complete plumbing and
kitchen facilities with a rent that is 30 percent or less of
50 percent of the adjusted area median income as determined
by the Secretary that are occupied by either extremely low-
or very low-income renter households or are vacant for rent;
and
``(ii) the number of extremely low- and very low-income
renter households.
``(B) Rule of construction.--If the number of units
described in subparagraph (A)(i) exceeds the number of
extremely low- and very low-income households as described in
subparagraph (A)(ii), there is no shortage.''.
SEC. 5. DUTY TO SERVE UNDERSERVED MARKETS.
(a) Establishment and Evaluation of Performance.--Section
1335 of the Housing and Community Development Act of 1992 (12
U.S.C. 4565) is amended--
(1) in the section heading, by inserting ``duty to serve
underserved markets and'' before ``other'';
(2) by striking subsection (b);
(3) in subsection (a)--
(A) in the matter preceding paragraph (1), by inserting
``and to carry out the duty under subsection (a) of this
section,'' before ``, each enterprise shall'';
(B) in paragraph (3), by inserting ``and'' after the
semicolon at the end;
(C) in paragraph (4), by striking ``; and'' and inserting a
period;
(D) by striking paragraph (5); and
(E) by redesignating such subsection as subsection (b);
(4) by inserting before subsection (b) (as redesignated by
paragraph (3)(E) of this subsection) the following new
subsection:
``(a) Duty To Serve Underserved Markets.--
``(1) Duty.--In accordance with the purpose of the
enterprises under section 301(3) of the Federal National
Mortgage Association Charter Act (12 U.S.C. 1716) and section
301(b)(3) of the Federal Home Loan Mortgage Corporation Act
(12 U.S.C. 1451 note) to undertake activities relating to
mortgages on housing for very low-, low-, and moderate-income
families involving a reasonable economic return that may be
less than the return earned on other activities, each
enterprise shall have the duty to purchase or securitize
mortgage investments and improve the distribution of
investment capital available for mortgage financing for
underserved markets.
``(2) Underserved markets.--To meet its duty under
paragraph (1), each enterprise shall comply with the
following requirements with respect to the following
underserved markets:
``(A) Manufactured housing.--The enterprise shall lead the
industry in developing loan products and flexible
underwriting guidelines to facilitate a secondary market for
mortgages on manufactured homes for very low-, low-, and
moderate-income families.
``(B) Affordable housing preservation.--The enterprise
shall lead the industry in developing loan products and
flexible underwriting guidelines to facilitate a secondary
market to preserve housing affordable to extremely low-, very
low-, and low-income families, including housing projects
subsidized under--
``(i) the project-based and tenant-based rental assistance
programs under section 8 of the United States Housing Act of
1937;
``(ii) the program under section 236 of the National
Housing Act;
``(iii) the below-market interest rate mortgage program
under section 221(d)(4) of the National Housing Act;
``(iv) the supportive housing for the elderly program under
section 202 of the Housing Act of 1959;
``(v) the supportive housing program for persons with
disabilities under section 811 of the Cranston-Gonzalez
National Affordable Housing Act; and
``(vi) the rural rental housing program under section 515
of the Housing Act of 1949.
``(C) Subprime borrowers.--The enterprises shall lead the
industry in making mortgage credit available to low- and
moderate-income families with credit impairment, and shall
develop underwriting guidelines that preclude the purchase of
loans with unacceptable terms and conditions, or which are
contrary to good lending practices or to sustainable
homeownership, including--
``(i) mandatory arbitration provisions;
``(ii) single premium credit insurance financed into the
mortgages;
``(iii) unreasonable prepayment penalties and up front
fees;
``(iv) introductory rates that expire in less than 10
years; and
``(v) any other such loans with unacceptable terms and
conditions, or which are contrary to good lending practices
or to sustainable homeownership.
``(D) Community development financial institutions.--The
enterprises shall--
``(i) lead the industry in developing loan products and
flexible underwriting guidelines to facilitate a secondary
market for mortgages on unconventional affordable housing
loans made or purchased by Treasury certified community
development financial institutions and other nonprofit
housing lenders; and
``(ii) utilize credit facilities, capital and loss
reserves, credit enhancements, securitization, and other
methods to facilitate a secondary market for mortgages on
unconventional affordable housing loans made or purchased by
community development financial institutions certified by the
Secretary of the Treasury, as determined by the Secretary and
consistent with the Federal National Mortgage Association
Charter Act, the Federal Home Loan Mortgage Corporation Act,
and the provisions of this Act.
``(E) Community reinvestment act considerations.--The
enterprise shall take affirmative steps to assist depository
institutions to meet their obligations under the Community
Reinvestment Act, which shall include developing appropriate
underwriting standards, business practices, repurchase
requirements, pricing, fees, and procedures.
``(F) Rural and other underserved markets.--
``(i) In general.--The enterprises shall lead the industry
in developing loan products and flexible underwriting
guidelines to facilitate a secondary market for mortgages on
housing for very low-, low-, and moderate-income families in
rural areas, and for mortgages for housing for any other
underserved market for very low-, low-, and moderate-income
families that the Secretary identifies as lacking adequate
credit through conventional lending sources.
``(ii) Identification of underserved markets.--Underserved
markets may be identified for purposes of this paragraph by
borrower type, market segment, or geographic area.
``(G) Other underserved markets.--The Secretary may, by
rule, determine other underserved markets that the
enterprises shall be required to lead the market in
facilitating the availability of investment capital for
mortgage financing for such markets.''; and
(5) by adding at the end the following new subsection:
``(c) Evaluation and Reporting of Compliance.--
``(1) Evaluating compliance.--
``(A) In general.--Not later than 6 months after the date
of enactment of the Government Sponsored Enterprise Mission
Improvement Act, the Secretary shall establish
[[Page S14634]]
through notice and comment rulemaking, a manner for
evaluating whether, and the extent to which, the enterprises
have complied with the duty under subsection (a) to serve
underserved markets, and for rating the extent of such
compliance.
``(B) Rating compliance.--Using the evaluation method
established under subparagraph (A), the Secretary shall, for
each year, evaluate such compliance and rate the performance
of each enterprise as to the extent of compliance.
``(C) Evaluations and ratings included in annual report of
the secretary.--The Secretary shall include such evaluation
and rating for each enterprise for a year in the report for
that year submitted pursuant to section 1319B(a).
``(2) Separate evaluations.--In determining whether an
enterprise has complied with the duty referred to in
paragraph (1), the Secretary shall separately evaluate
whether the enterprise has complied with such duty with
respect to each of the underserved markets identified in
subsection (a), taking into consideration--
``(A) the development of loan products and more flexible
underwriting guidelines;
``(B) the volume of loans purchased in each of such
underserved markets; and
``(C) such other factors as the Secretary may determine.''.
(b) Enforcement.--Section 1336(a) of the Housing and
Community Development Act of 1992 (12 U.S.C. 4566(a)) is
amended--
(1) in paragraph (1), by inserting ``and with the duty
under section 1335(a) of each enterprise with respect to
underserved markets'' before ``, as provided in this
section,''; and
(2) by adding at the end the following new paragraph:
``(4) Enforcement of duty to provide mortgage credit to
underserved markets.--
``(A) In general.--The duty under section 1335(a) of each
enterprise to serve underserved markets (as determined in
accordance with section 1335(c)) shall be enforceable under
this section to the same extent and under the same provisions
that the housing goals established under sections 1332, 1333,
and 1334 are enforceable.
``(B) Limitation.--The duty under section 1335(a) shall not
be enforceable under any other provision of this title
(including subpart C of this part) other than this section or
under any provision of the Federal National Mortgage
Association Charter Act or the Federal Home Loan Mortgage
Corporation Act.''.
SEC. 6. MONITORING AND ENFORCING COMPLIANCE WITH HOUSING
GOALS.
Section 1336 of the Housing and Community Development Act
of 1992 (12 U.S.C. 4566) is amended--
(1) in subsection (b)--
(A) in the subsection heading, by inserting ``Preliminary''
before ``Determination'';
(B) by striking paragraph (1) and inserting the following
new paragraph:
``(1) Notice.--If the Secretary preliminarily determines
that an enterprise has failed, or that there is a substantial
probability that an enterprise will fail to meet any housing
goal established under this subpart, the Secretary shall
provide written notice to the enterprise of such a
preliminary determination, the reasons for such
determination, and the information on which the Secretary
based the determination.'';
(C) in paragraph (2)--
(i) in subparagraph (A), by inserting ``finally'' before
``determining'';
(ii) by striking subparagraphs (B) and (C) and inserting
the following new subparagraph:
``(B) Extension or shortening of period.--The Secretary
may--
``(i) extend the period under subparagraph (A) for good
cause for not more than 30 additional days; and
``(ii) shorten the period under subparagraph (A) for good
cause.''; and
(iii) by redesignating subparagraph (D) as subparagraph
(C); and
(D) in paragraph (3)--
(i) in subparagraph (A), by striking ``determine'' and
inserting ``issue a final determination of'';
(ii) in subparagraph (B), by inserting ``final'' before
``determinations''; and
(iii) in subparagraph (C)--
(I) by striking ``Committee on Banking, Finance and Urban
Affairs'' and inserting ``Committee on Financial Services'';
and
(II) by inserting ``final'' before ``determination'' each
place such term appears; and
(2) in subsection (c)--
(A) by striking the subsection designation and heading and
all that follows through the end of paragraph (1) and
inserting the following:
``(c) Cease-and-Desist Orders, Civil Money Penalties, and
Remedies Including Housing Plans.--
``(1) Requirement.--
``(A) Housing plan.--If the Secretary finds, pursuant to
subsection (b), that there is a substantial probability that
an enterprise will fail, or has actually failed to meet any
housing goal under this subpart and that the achievement of
the housing goal was or is feasible, the Secretary may
require that the enterprise submit a housing plan under this
subsection.
``(B) Refusal to submit housing plan.--If the Secretary
makes such a finding and the enterprise refuses to submit
such a plan, submits an unacceptable plan, fails to comply
with the plan or the Secretary finds that the enterprise has
failed to meet any housing goal under this subpart, in
addition to requiring an enterprise to submit a housing plan,
the Secretary may--
``(i) issue a cease-and-desist order in accordance with
section 1341;
``(ii) impose civil money penalties in accordance with
section 1345; or
``(iii) order other remedies as set forth in paragraph (7)
of this subsection.'';
(B) in paragraph (2)--
(i) by striking ``Contents.--Each housing plan'' and
inserting ``Housing plan.--If the Secretary requires a
housing plan under this section, such a plan''; and
(ii) in subparagraph (B), by inserting ``and changes in its
operations'' after ``improvements'';
(C) in paragraph (3)--
(i) by inserting ``comply with any remedial action or''
before ``submit a housing plan''; and
(ii) by striking ``under subsection (b)(3) that a housing
plan is required'';
(D) in paragraph (4), by striking the first 2 sentences and
inserting the following:
``(A) Review.--The Secretary shall review each submission
by an enterprise, including a housing plan submitted under
this subsection, and not later than 30 days after submission,
approve or disapprove the plan or other action.
``(B) Extension of time.--The Secretary may extend the
period for approval or disapproval for a single additional
30-day period if the Secretary determines such extension
necessary.
``(C) Approval.--''; and
(E) by adding at the end the following new paragraph:
``(7) Additional remedies for failure to meet goals.--In
addition to ordering a housing plan under this section,
issuing cease-and-desist orders under section 1341, and
ordering civil money penalties under section 1345, the
Secretary may--
``(A) seek other actions when an enterprise fails to meet a
goal; and
``(B) exercise appropriate enforcement authority available
to the Secretary under this Act.''.
SEC. 7. AFFORDABLE HOUSING PROGRAMS.
(a) Repeal.--Sections 1337 of the Housing and Community
Development Act of 1992 (12 U.S.C. 4562 note) is hereby
repealed.
(b) Annual Housing Report.--The Housing and Community
Development Act of 1992 is amended by inserting after section
1336 the following:
``SEC. 1337. AFFORDABLE HOUSING ALLOCATIONS.
``(a) Set Aside and Allocation of Amounts by Enterprises.--
Subject to subsection (b), in each fiscal year--
``(1) the Federal Home Loan Mortgage Corporation shall--
``(A) set aside an amount equal to 4.2 basis points for
each dollar of unpaid principal balance of its total new
business purchases; and
``(B) allocate or otherwise transfer--
``(i) 65 percent of such amounts to the Secretary of
Housing and Urban Development to fund the affordable housing
block grant program established under section 1338; and
``(ii) 35 percent of such amounts to fund the Capital
Magnet Fund established pursuant to section 1339; and
``(2) the Federal National Mortgage Association shall--
``(A) set aside an amount equal to 4.2 basis points for
each dollar of unpaid principal balance of its total new
business purchases; and
``(B) allocate or otherwise transfer--
``(i) 65 percent of such amounts to the Secretary of
Housing and Urban Development to fund the affordable housing
block grant program established under section 1338; and
``(ii) 35 percent of such amounts to fund the Capital
Magnet Fund established pursuant to section 1339.
``(b) Suspension of Contributions.--The Secretary shall
temporarily suspend allocations under subsection (a) by an
enterprise upon a finding by the Secretary that such
allocations--
``(1) are contributing, or would contribute, to the
financial instability of the enterprise;
``(2) are causing, or would cause, the enterprise to be
classified as undercapitalized; or
``(3) are preventing, or would prevent, the enterprise from
successfully completing a capital restoration plan under
section 1369C.
``(c) Prohibition of Pass-Through of Cost of Allocations.--
The Secretary shall, by regulation, prohibit each enterprise
from redirecting the costs of any allocation required under
this section, through increased charges or fees, or decreased
premiums, or in any other manner, to the originators of
mortgages purchased or securitized by the enterprise.
``(d) Enforcement of Requirements on Enterprise.--
Compliance by the enterprises with the requirements under
this section shall be enforceable under subpart C. Any
reference in such subpart to this part or to an order, rule,
or regulation under this part specifically includes this
section and any order, rule, or regulation under this
section.
``SEC. 1338. AFFORDABLE HOUSING BLOCK GRANT PROGRAM.
``(a) Establishment and Purpose.--The Secretary of Housing
and Urban Development shall establish and manage an
affordable housing block grant program, which shall be funded
with amounts allocated by the enterprises under section 1337.
The purpose of the block grant program under this section is
to provide grants to States for use--
``(1) to increase and preserve the supply of rental housing
for extremely low- and very
[[Page S14635]]
low-income families, including homeless families; and
``(2) to increase homeownership for extremely low- and very
low-income families.
``(b) Affordable Housing Block Grant Allocations for
Homeownership Preservation in Fiscal Year 2008.--
``(1) Assistance for homeowners facing foreclosure.--
``(A) In general.--To help address the subprime mortgage
crisis, in fiscal year 2008, 100 percent of the amounts
allocated for grants under this section shall be used to make
grants to States to--
``(i) facilitate loan modification and refinance options
for low- and moderate-income borrowers facing foreclosure;
and
``(ii) expeditiously make available to low- and moderate-
income homebuyers, properties that have been foreclosed upon.
``(B) Distribution.--The amounts allocated to help address
the subprime mortgage crisis under subparagraph (A) shall be
distributed according to a formula established by the
Secretary.
``(2) Permissible designees.--A State receiving grant
amounts under this subsection may designate a State housing
finance agency, housing and community development entity,
tribally designated housing entity (as such term is defined
in section 4 of the Native American Housing Assistance and
Self-Determination Act of 1997 (25 U.S.C. 4103)), or any
other qualified instrumentality of the State to receive such
grant amounts.
``(3) Development of distribution formula.--Not later than
3 months after the date of enactment of the Government
Sponsored Enterprise Mission Improvement Act, the Secretary
shall develop the distribution formula required under
paragraph (1)(B). Such formula shall be based on the
following factors:
``(A) The population of the State based on the most recent
estimate of the resident population of such State as
determined by the Bureau of the Census.
``(B) The 90-day delinquency rate of the State.
``(C) The ratio of foreclosures to owner-occupied
households within the State.
``(4) Eligible loan uses.--
``(A) Loans to homeowners to preserve homeownership.--
``(i) In general.--A State or State designated entity shall
use any grant amounts made available under this subsection
to--
``(I) support the refinancing of loans of eligible
homeowners, only if such loans have a loan-to-value ratio of
not greater than 100 percent of current appraised value of
the home on which such loan was taken;
``(II) reduce the outstanding loan balances of eligible
homeowners, but only if the lender, servicer, investor, or
other appropriate entity reduces such balance by the amount
necessary to bring the combined loan value (including first
and second mortgages) at or below 100 percent of the
appraised value of the home; and
``(III) pay off any outstanding amounts owed by eligible
homeowners for taxes and insurance.
``(ii) Program requirements for eligible homeowners.--
``(I) Development by states.--Each State or State
designated entity that is a recipient of a grant amount under
this subsection shall develop program requirements for
eligible homeowners seeking a loan under this subparagraph.
``(II) Required content.--The program requirements required
to be developed under this clause shall, at a minimum,
include the following:
``(aa) The annual income of the homeowner is no greater
than the annual income established by the Secretary as being
of low- or moderate-income.
``(bb) That any loan under this paragraph may be provided
for up to a 4-family owner-occupied residence, including 1-
family units in a condominium project or a membership
interest and occupancy agreement in a cooperative housing
project, that is used, or is to be used, as the principal
residence of the applicant seeking such grant or loan.
``(cc) The homeowner has a loan with unsustainable loan
terms, as determined by a State housing finance agency or
other designated State agency. For purposes of this item, the
term `unsustainable loan terms' includes such activities as
the lack of escrow of taxes and insurance, the inclusion of
prepayment penalties, and the lack of the ability of the
homeowner to pay at the fully indexed interest rate because
the debt-to-income ratio on such home loan is greater than 45
percent.
``(iii) Loan requirements.--In order for a State or State
designated entity to use the amounts made available under
this subsection to assist eligible homeowners, a loan under
this subparagraph--
``(I) shall--
``(aa) have a fixed interest rate;
``(bb) be affordable, so that the maximum debt-to-income
ratio of such loan is not greater than 45 percent;
``(cc) require mandatory escrow of taxes and insurance;
``(dd) have no prepayment penalties;
``(ee) have no mandatory arbitration clauses; and
``(ff) if the loan-to-value ratio of the original mortgage
loan is greater than 100 percent, require the lender to
reduce such balance by the amount necessary to bring the loan
value at or below 100 percent of the appraised value of the
home;
``(II) shall not be due and payable unless--
``(aa) the real property securing such loan is sold,
transferred, or refinanced; or
``(bb) the last surviving homeowner of such real property
dies;
``(III) shall not exceed 10 percent of the principal
balance; and
``(IV) may be subordinated.
``(iv) Existing loan funds.--Any State or State designated
entity with a previously existing fund established to make
loans to assist homeowners in satisfying any amounts past due
on their home loan may use funds appropriated for purposes of
this subparagraph for that existing loan fund, even if the
eligibility, application, program, or use requirements for
that loan program differ from the eligibility, application,
program, and use requirements of this subparagraph, unless
such use is expressly determined by the Secretary to be
inappropriate.
``(v) No foreclosure if notice of application for home
preservation loan.--A mortgagee shall not initiate a
foreclosure--
``(I) upon receipt of a written confirmation from the State
or other State designated entity that the homeowner has
applied for a home preservation loan under this subparagraph;
and
``(II) for the 2-month period after receipt of such written
confirmation or until the mortgagee is informed, in writing,
that the homeowner is not eligible for a home preservation
loan, whichever occurs first.
``(B) Loans to nonprofit developers for the rehabilitation
and sale of foreclosed properties to low- and moderate-income
homebuyers.--
``(i) In general.--A State or State designated entity may
use up to 20 percent of the grant amounts made available
under this subsection for homeownership preservation to
provide loans to nonprofit affordable housing developers for
the purposes of assisting low- and moderate-income homebuyers
to purchase properties that are in the process of being
foreclosed upon or have been acquired by the mortgage holder
through the foreclosure process.
``(ii) Program requirements for nonprofit affordable
housing developers.--
``(I) In general.--Each State or State designated entity
that is a recipient of a grant under this subsection shall,
if they choose to use part of their grant award to make loans
under this subparagraph, develop program requirements for
nonprofit affordable housing developers for the purposes of
assisting low- and moderate-income homebuyers to purchase
properties that are in the process of being foreclosed upon
or have been acquired by the mortgage holder through the
foreclosure process.
``(II) Required content.--The program requirements
developed under subclause (I) shall, at a minimum, include
the following:
``(aa) That any loan under this clause may be provided for
up to a 4-family owner-occupied residence, including 1-family
units in a condominium project or a membership interest and
occupancy agreement in a cooperative housing project, that is
used, or is to be used, as the principal residence of a low-
or moderate-income homebuyer.
``(bb) The annual income of the low- or moderate-income
homebuyer is not greater than the annual income established
by the Secretary as being of low- or moderate-income.
``(cc) The property is in foreclosure or has been acquired
by the mortgage holder through the foreclosure process, the
property has been appraised, and the sales price of the
property does not exceed 100 percent of the appraised value
of the property.
``(iii) Loan requirements.--In order for a State or State
designated entity to use the amounts made available under
this subsection, a loan under this subparagraph--
``(I) may be used for--
``(aa) downpayment and closing costs;
``(bb) financing the difference between the sales price of
a home and the mortgage for which the low- or moderate-income
homebuyer qualifies; and
``(cc) repairs of a home not to exceed 10 percent of the
appraised value of the home;
``(II) shall carry a zero percent interest rate;
``(III) shall not be due and payable by the low- or
moderate-income homebuyer unless--
``(aa) the real property securing such loan is sold,
transferred, or refinanced; or
``(bb) the last surviving homeowner of such real property
dies; and
``(IV) may be subordinated.
``(iv) Existing loan funds.--Any State or State designated
entity with a previously existing fund established to make
loans for the purposes of this subparagraph may use funds
appropriated for purposes of this subparagraph for that
existing loan fund, even if the eligibility, application,
program, or use requirements for that loan program differ
from the eligibility, application, program, and use
requirements of this subparagraph, unless such use is
expressly determined by the Secretary to be inappropriate.
``(c) Allocation for Affordable Housing Block Grants in
2009 and Subsequent Years.--
``(1) In general.--Except as provided in subsection (b),
during each fiscal year the Secretary of Housing and Urban
Development shall distribute the amounts allocated for the
affordable housing block grant program under this section to
provide affordable housing as described in this subsection.
``(2) Permissible designees.--A State receiving grant
amounts under this subsection
[[Page S14636]]
may designate a State housing finance agency, housing and
community development entity, tribally designated housing
entity (as such term is defined in section 4 of the Native
American Housing Assistance and Self-Determination Act of
1997 (25 U.S.C. 4103)), or any other qualified
instrumentality of the State to receive such grant amounts.
``(3) Distribution to states by needs-based formula.--
``(A) In general.--The Secretary of Housing and Urban
Development shall, by regulation, establish a formula within
12 months of the date of enactment of the Government
Sponsored Enterprise Mission Improvement Act, to distribute
amounts made available under this subsection to each State to
provide affordable housing to extremely low- and very low-
income households.
``(B) Basis for formula.--The formula required under
subparagraph (A) shall include the following:
``(i) The ratio of the shortage of standard rental units
both affordable and available to extremely low-income renter
households in the State to the aggregate shortage of standard
rental units both affordable and available to extremely low-
income renter households in all the States.
``(ii) The ratio of the shortage of standard rental units
both affordable and available to very low-income renter
households in the State to the aggregate shortage of standard
rental units both affordable and available to very low-income
renter households in all the States.
``(iii) The ratio of extremely-low income renter households
in the State living with either (I) incomplete kitchen or
plumbing facilities, (II) more than 1 person per room, or
(III) paying more than 50 percent of income for housing
costs, to the aggregate number of extremely low-income renter
households living with either (IV) incomplete kitchen or
plumbing facilities, (V) more than 1 person per room, or (VI)
paying more than 50 percent of income for housing costs in
all the States.
``(iv) The ratio of very low-income renter households in
the State paying more than 50 percent of income on rent
relative to the aggregate number of very low-income renter
households paying more than 50 percent of income on rent in
all the States.
``(v) The resulting sum calculated from the factors
described in clauses (i) through (iv) shall be multiplied by
the relative cost of construction in the State. For purposes
of this subclause, the term `cost of construction'--
``(I) means the cost of construction or building
rehabilitation in the State relative to the national cost of
construction or building rehabilitation; and
``(II) shall be calculated such that values higher than 1.0
indicate that the State's construction costs are higher than
the national average, a value of 1.0 indicates that the
State's construction costs are exactly the same as the
national average, and values lower than 1.0 indicate that the
State's cost of construction are lower than the national
average.
``(C) Priority.--The formula required under subparagraph
(A) shall give priority emphasis and consideration to the
factor described in subparagraph (B)(i).
``(4) Allocation of grant amounts.--
``(A) Notice.--Not later than 60 days after the date that
the Secretary of Housing and Urban Development determines the
formula amounts described in paragraph (3), the Secretary
shall caused to be published in the Federal Register a notice
that such amounts shall be so available.
``(B) Grant amount.--In each fiscal year other than fiscal
year 2008, the Secretary of Housing and Urban Development
shall make a block grant to each State in an amount that is
equal to the formula amount determined under paragraph (3)
for that State.
``(C) Minimum state allocations.--If the formula amount
determined under paragraph (3) for a fiscal year would
allocate less than $3,000,000 to any State, the allocation
for such State shall be $3,000,000, and the increase shall be
deducted pro rata from the allocations made to all other
States.
``(5) Allocation plans required.--
``(A) In general.--For each year that a State or State
designated entity receives an affordable housing block grant
under this subsection, the State or State designated entity
shall establish an allocation plan. Such plan shall--
``(i) set forth a plan for the distribution of grant
amounts received by the State or State designated entity for
such year;
``(ii) be based on priority housing needs, as determined by
the State or State designated entity in accordance with the
regulations established under subsection (g)(2)(C);
``(iii) comply with paragraph (6); and
``(iv) include performance goals that comply with the
requirements established by the Secretary pursuant to
subsection (g)(2).
``(B) Establishment.--In establishing an allocation plan
under this paragraph, a State or State designated entity
shall--
``(i) notify the public of the establishment of the plan;
``(ii) provide an opportunity for public comments regarding
the plan;
``(iii) consider any public comments received regarding the
plan; and
``(iv) make the completed plan available to the public.
``(C) Contents.--An allocation plan of a State or State
designated entity under this paragraph shall set forth the
requirements for eligible recipients under paragraph (8) to
apply for such grant amounts, including a requirement that
each such application include--
``(i) a description of the eligible activities to be
conducted using such assistance; and
``(ii) a certification by the eligible recipient applying
for such assistance that any housing units assisted with such
assistance will comply with the requirements under this
section.
``(6) Selection of activities funded using affordable
housing fund grant amounts.--Grant amounts received by a
State or State designated entity under this subsection may be
used, or committed for use, only for activities that--
``(A) are eligible under paragraph (7) for such use;
``(B) comply with the applicable allocation plan of the
State or State designated entity under paragraph (5); and
``(C) are selected for funding by the State or State
designated entity in accordance with the process and criteria
for such selection established pursuant to subsection
(g)(2)(C).
``(7) Eligible activities.--Grant amounts allocated to a
State or State designated entity under this subsection shall
be eligible for use, or for commitment for use, only for
assistance for--
``(A) the production, preservation, and rehabilitation of
rental housing, including housing under the programs
identified in section 1335(a)(2)(B) and for operating costs,
except that such grant amounts may be used for the benefit
only of extremely low- and very low-income families; and
``(B) the production, preservation, and rehabilitation of
housing for homeownership, including such forms as
downpayment assistance, closing cost assistance, and
assistance for interest rate buy-downs, that--
``(i) is available for purchase only for use as a principal
residence by families that qualify both as--
``(I) extremely low- and very low-income families at the
times described in subparagraphs (A) through (C) of section
215(b)(2) of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 12745(b)(2)); and
``(II) first-time homebuyers, as such term is defined in
section 104 of the Cranston-Gonzalez National Affordable
Housing Act (42 U.S.C. 12704), except that any reference in
such section to assistance under title II of such Act shall
for purposes of this subsection be considered to refer to
assistance from affordable housing fund grant amounts;
``(ii) has an initial purchase price that meets the
requirements of section 215(b)(1) of the Cranston-Gonzalez
National Affordable Housing Act;
``(iii) is subject to the same resale restrictions
established under section 215(b)(3) of the Cranston-Gonzalez
National Affordable Housing Act and applicable to the
participating jurisdiction that is the State in which such
housing is located; and
``(iv) is made available for purchase only by, or in the
case of assistance under this subsection, is made available
only to homebuyers who have, before purchase completed a
program of counseling with respect to the responsibilities
and financial management involved in homeownership that is
approved by the Secretary;
``(8) Eligible recipients.--Grant amounts allocated to a
State or State designated entity under this subsection may be
provided only to a recipient that is an organization, agency,
or other entity (including a for-profit entity or a nonprofit
entity) that--
``(A) has demonstrated experience and capacity to conduct
an eligible activity under paragraph (7), as evidenced by its
ability to--
``(i) own, construct or rehabilitate, manage, and operate
an affordable multifamily rental housing development;
``(ii) design, construct or rehabilitate, and market
affordable housing for homeownership; or
``(iii) provide forms of assistance, such as downpayments,
closing costs, or interest rate buy-downs for purchasers;
``(B) demonstrates the ability and financial capacity to
undertake, comply, and manage the eligible activity;
``(C) demonstrates its familiarity with the requirements of
any other Federal, State, or local housing program that will
be used in conjunction with such grant amounts to ensure
compliance with all applicable requirements and regulations
of such programs; and
``(D) makes such assurances to the State or State
designated entity as the Secretary shall, by regulation,
require to ensure that the recipient will comply with the
requirements of this subsection during the entire period that
begins upon selection of the recipient to receive such grant
amounts and ending upon the conclusion of all activities
under paragraph (8) that are engaged in by the recipient and
funded with such grant amounts.
``(9) Limitations on use.--
``(A) Required amount for homeownership activities.--Of the
aggregate amount allocated to a State or State designated
entity under this subsection not more than 10 percent shall
be used for activities under subparagraph (B) of paragraph
(7).
``(B) Deadline for commitment or use.--Grant amounts
allocated to a State or State designated entity under this
subsection shall be used or committed for use within 2 years
of the date that such grant amounts are made available to the
State or State designated entity. The Secretary shall
recapture any such amounts not so used or committed for use
and reallocate such amounts
[[Page S14637]]
under this subsection in the first year after such recapture.
``(C) Use of returns.--The Secretary shall, by regulation,
provide that any return on a loan or other investment of any
grant amount used by a State or State designated entity to
provide a loan under this subsection shall be treated, for
purposes of availability to and use by the State or State
designated entity, as a block grant amount authorized under
this subsection.
``(D) Prohibited uses.--The Secretary shall, by
regulation--
``(i) set forth prohibited uses of grant amounts allocated
under this subsection, which shall include use for--
``(I) political activities;
``(II) advocacy;
``(III) lobbying, whether directly or through other
parties;
``(IV) counseling services;
``(V) travel expenses; and
``(VI) preparing or providing advice on tax returns;
``(ii) provide that, except as provided in clause (iii),
affordable housing block grant amounts of a State or State
designated entity may not be used for administrative,
outreach, or other costs of--
``(I) the State or State designated entity; or
``(II) any other recipient of such grant amounts; and
``(iii) limit the amount of any affordable housing block
grant amounts for a year that may be used by the State or
State designated entity for administrative costs of carrying
out the program required under this subsection to a
percentage of such grant amounts of the State or State
designated entity for such year, which may not exceed 10
percent.
``(E) Prohibition of consideration of use for meeting
housing goals or duty to serve.--In determining compliance
with the housing goals under this subpart and the duty to
serve underserved markets under section 1335, the Secretary
may not consider any affordable housing block grant amounts
used under this section for eligible activities under
paragraph (7). The Secretary shall give credit toward the
achievement of such housing goals and such duty to serve
underserved markets to purchases by the enterprises of
mortgages for housing that receives funding from such block
grant amounts, but only to the extent that such purchases by
the enterprises are funded other than with such grant
amounts.
``(d) Reduction for Failure to Obtain Return of Misused
Funds.--If in any year a State or State designated entity
fails to obtain reimbursement or return of the full amount
required under subsection (e)(1)(B) to be reimbursed or
returned to the State or State designated entity during such
year--
``(1) except as provided in paragraph (2)--
``(A) the amount of the grant for the State or State
designated entity for the succeeding year, as determined
pursuant to this section, shall be reduced by the amount by
which such amounts required to be reimbursed or returned
exceed the amount actually reimbursed or returned; and
``(B) the amount of the grant for the succeeding year for
each other State or State designated entity whose grant is
not reduced pursuant to subparagraph (A) shall be increased
by the amount determined by applying the formula established
pursuant to this section to the total amount of all
reductions for all State or State designated entities for
such year pursuant to subparagraph (A); or
``(2) in any case in which such failure to obtain
reimbursement or return occurs during a year immediately
preceding a year in which grants under this section will not
be made, the State or State designated entity shall pay to
the Secretary for reallocation among the other grantees an
amount equal to the amount of the reduction for the entity
that would otherwise apply under paragraph (1)(A).
``(e) Accountability of Recipients and Grantees.--
``(1) Recipients.--
``(A) Tracking of funds.--The Secretary shall--
``(i) require each State or State designated entity to
develop and maintain a system to ensure that each recipient
of assistance under this section uses such amounts in
accordance with this section, the regulations issued under
this section, and any requirements or conditions under which
such amounts were provided; and
``(ii) establish minimum requirements for agreements,
between the State or State designated entity and recipients,
regarding assistance under this section, which shall
include--
``(I) appropriate periodic financial and project reporting,
record retention, and audit requirements for the duration of
the assistance to the recipient to ensure compliance with the
limitations and requirements of this section and the
regulations under this section; and
``(II) any other requirements that the Secretary determines
are necessary to ensure appropriate administration and
compliance.
``(B) Misuse of funds.--
``(i) Reimbursement requirement.--If any recipient of
assistance under this section is determined, in accordance
with clause (ii), to have used any such amounts in a manner
that is materially in violation of this section, the
regulations issued under this section, or any requirements or
conditions under which such amounts were provided, the State
or State designated entity shall require that, within 12
months after the determination of such misuse, the recipient
shall reimburse the State or State designated entity for such
misused amounts and return to the State or State designated
entity any such amounts that remain unused or uncommitted for
use. The remedies under this clause are in addition to any
other remedies that may be available under law.
``(ii) Determination.--A determination is made in
accordance with this clause if the determination is made by
the Secretary or made by the State or State designated
entity, provided that--
``(I) the State or State designated entity provides
notification of the determination to the Secretary for
review, in the discretion of the Secretary, of the
determination; and
``(II) the Secretary does not subsequently reverse the
determination.
``(2) Grantees.--
``(A) Report.--
``(i) In general.--The Secretary shall require each State
or State designated entity receiving grant amounts in any
given year under this section to submit a report, for such
year, to the Secretary that--
``(I) describes the activities funded under this section
during such year with such grant amounts; and
``(II) the manner in which the State or State designated
entity complied during such year with any allocation plan
established pursuant to subsection (c).
``(ii) Public availability.--The Secretary shall make such
reports pursuant to this subparagraph publicly available.
``(B) Misuse of funds.--If the Secretary determines, after
reasonable notice and opportunity for hearing, that a State
or State designated entity has failed to comply substantially
with any provision of this section, and until the Secretary
is satisfied that there is no longer any such failure to
comply, the Secretary shall--
``(i) reduce the amount of assistance under this section to
the State or State designated entity by an amount equal to
the amount of block grant amounts which were not used in
accordance with this section;
``(ii) require the State or State designated entity to
repay the Secretary an amount equal to the amount of the
amount block grant amounts which were not used in accordance
with this section;
``(iii) limit the availability of assistance under this
section to the State or State designated entity to activities
or recipients not affected by such failure to comply; or
``(iv) terminate any assistance under this section to the
State or State designated entity.
``(f) Definitions.--For purposes of this section, the
following definitions shall apply:
``(1) Extremely low-income renter household.--The term
`extremely low-income renter household' means a household
whose income is not in excess of 30 percent of the area
median income, with adjustments for smaller and larger
families, as determined by the Secretary.
``(2) Recipient.--The term `recipient' means an individual
or entity that receives assistance from a State or State
designated entity from amounts made available to the State or
State designated entity under this section.
``(3) Shortage of standard rental units both affordable and
available to extremely low-income renter households.--
``(A) In general.--The term `shortage of standard rental
units both affordable and available to extremely low-income
renter households' means for any State or other geographical
area the gap between--
``(i) the number of units with complete plumbing and
kitchen facilities with a rent that is 30 percent or less of
30 percent of the adjusted area median income as determined
by the Secretary that are occupied by extremely low-income
renter households or are vacant for rent; and
``(ii) the number of extremely low-income renter
households.
``(B) Rule of construction.--If the number of units
described in subparagraph (A)(i) exceeds the number of
extremely low-income households as described in subparagraph
(A)(ii), there is no shortage.
``(4) Shortage of standard rental units both affordable and
available to very low-income renter households.--
``(A) In general.--The term `shortage of standard rental
units both affordable and available to very low-income renter
households' means for any State or other geographical area
the gap between--
``(i) the number of units with complete plumbing and
kitchen facilities with a rent that is 30 percent or less of
50 percent of the adjusted area median income as determined
by the Secretary that are occupied by very low-income renter
households or are vacant for rent; and
``(ii) the number of very low-income renter households.
``(B) Rule of construction.--If the number of units
described in subparagraph (A)(i) exceeds the number of very
low-income households as described in subparagraph (A)(ii),
there is no shortage.
``(5) Very low-income family.--The term `very low-income
family' has the meaning given such term in section 1303,
except that such term includes any family that resides in a
rural area that has an income that does not exceed the
poverty line (as such term is defined in section 673(2) of
the Omnibus Budget Reconciliation Act of 1981 (42 U.S.C.
9902(2)), including any revision required by such section)
applicable to a family of the size involved.
[[Page S14638]]
``(6) Very low-income renter households.--The term `very
low-income renter households' means a household whose income
is in excess of 30 percent but not greater than 50 percent of
the area median income, with adjustments for smaller and
larger families, as determined by the Secretary.
``(g) Regulations.--
``(1) In general.--The Secretary of Housing and Urban
Development, shall issue regulations to carry out this
section.
``(2) Required contents.--The regulations issued under this
subsection shall include--
``(A) a requirement that the Secretary ensure that the use
of block grant amounts under this section by States or State
designated entities is audited not less than annually to
ensure compliance with this section;
``(B) authority for the Secretary to audit, provide for an
audit, or otherwise verify a State or State designated
entity's activities to ensure compliance with this section;
``(C) requirements for a process for application to, and
selection by, each State or State designated entity for
activities meeting the State or State designated entity's
priority housing needs to be funded with block grant amounts
under this section, which shall provide for priority in
funding to be based upon--
``(i) geographic diversity;
``(ii) ability to obligate amounts and undertake activities
so funded in a timely manner;
``(iii) in the case of rental housing projects under
subsection (c)(7)(A), the extent to which rents for units in
the project funded are affordable, especially for extremely
low-income families;
``(iv) in the case of rental housing projects under
subsection (c)(7)(A), the extent of the duration for which
such rents will remain affordable;
``(v) the extent to which the application makes use of
other funding sources; and
``(vi) the merits of an applicant's proposed eligible
activity;
``(D) requirements to ensure that block grant amounts
provided to a State or State designated entity under this
section that are used for rental housing under subsection
(c)(7)(A) are used only for the benefit of extremely low- and
very low-income families; and
``(E) requirements and standards for establishment, by a
State or State designated entity, for use of block grant
amounts in 2009 and subsequent years of performance goals,
benchmarks, and timetables for the production, preservation,
and rehabilitation of affordable rental and homeownership
housing with such grant amounts.
``(h) Affordable Housing Trust Fund.--If, after the date of
enactment of the Government Sponsored Enterprise Mission
Improvement Act, in any year, there is enacted any provision
of Federal law establishing an affordable housing trust fund
other than under this title for use only for grants to
provide affordable rental housing and affordable
homeownership opportunities, and the subsequent year is a
year referred to in subsection (c), the Secretary shall in
such subsequent year and any remaining years referred to in
subsection (c) transfer to such affordable housing trust fund
the aggregate amount allocated pursuant to subsection (c) in
such year. Notwithstanding any other provision of law,
assistance provided using amounts transferred to such
affordable housing trust fund pursuant to this subsection may
not be used for any of the activities specified in clauses
(i) through (vi) of subsection (c)(9)(D).
``(i) Funding Accountability and Transparency.--Any grant
under this section to a grantee by a State or State
designated entity, any assistance provided to a recipient by
a State or State designated entity, and any grant, award, or
other assistance from an affordable housing trust fund
referred to in subsection (h) shall be considered a Federal
award for purposes of the Federal Funding Accountability and
Transparency Act of 2006 (31 U.S.C. 6101 note). Upon the
request of the Secretary of the Office of Management and
Budget, the Secretary shall obtain and provide such
information regarding any such grants, assistance, and awards
as the Secretary of the Office of Management and Budget
considers necessary to comply with the requirements of such
Act, as applicable, pursuant to the preceding sentence.
``SEC. 1339. CAPITAL MAGNET FUND.
``(a) Establishment.--There is established in the Treasury
of the United States a trust fund to be known as the Capital
Magnet Fund, which shall be a special account within the
Community Development Financial Institutions Fund.
``(b) Deposits to Trust Fund.--The Capital Magnet Fund
shall consist of--
``(1) any amounts transferred to the Fund pursuant to
section 1337; and
``(2) any amounts as are or may be appropriated,
transferred, or credited to such Fund under any other
provisions of law.
``(c) Expenditures From Trust Fund.--Amounts in the Capital
Magnet Fund shall be available to the Secretary of the
Treasury to carry out a competitive grant program to attract
private capital for and increase investment in--
``(1) the development, preservation, rehabilitation, and
purchase of affordable housing for primarily extremely low-,
very low-, and low-income families; and
``(2) economic development activities or community service
facilities, such as day care centers, workforce development
centers, and health care clinics, which in conjunction with
affordable housing activities implement a concerted strategy
to stabilize or revitalize a low-income area or underserved
rural area.
``(d) Federal Assistance.--All assistance provided using
amounts in the Capital Magnet Fund shall be considered to be
Federal financial assistance.
``(e) Eligible Grantees.--A grant under this section may be
made, pursuant to such requirements as the Secretary of the
Treasury shall establish for experience and success in
attracting private financing and carrying out the types of
activities proposed under the application of the grantee,
only to--
``(1) a community development financial institution; or
``(2) a nonprofit organization having as 1 of its principal
purposes the development or management of affordable housing.
``(f) Eligible Uses.--Grant amounts awarded from the
Capital Magnet Fund pursuant to this section may be used for
the purposes described in paragraphs (1) and (2) of
subsection (c), including for the following uses:
``(1) To provide loan loss reserves.
``(2) To capitalize a revolving loan fund.
``(3) To capitalize an affordable housing fund.
``(4) To capitalize a fund to support activities described
in subsection (c)(2).
``(5) For risk-sharing loans.
``(g) Applications.--
``(1) In general.--The Secretary of the Treasury shall
provide, in a competitive application process established by
regulation, for eligible grantees under subsection (e) to
submit applications for Capital Magnet Fund grants to the
Secretary at such time and in such manner as the Secretary
shall determine.
``(2) Content of application.--The application required
under paragraph (1) shall include a detailed description of--
``(A) the types of affordable housing, economic, and
community revitalization projects that support or sustain
residents of an affordable housing project funded by a grant
under this section for which such grant amounts would be
used, including the proposed use of eligible grants as
authorized under this section;
``(B) the types, sources, and amounts of other funding for
such projects; and
``(C) the expected timeframe of any grant used for such
project.
``(h) Grant Limitation.--
``(1) In general.--Any 1 eligible grantee and its
subsidiaries and affiliates may not be awarded more than 15
percent of the aggregate funds available for grants during
any year from the Capital Magnet Fund.
``(2) Geographic diversity.--
``(A) Goal.--The Secretary of the Treasury shall seek to
fund activities in geographically diverse areas of economic
distress, including metropolitan and underserved rural areas
in every State.
``(B) Diversity defined.--For purposes of this paragraph,
geographic diversity includes those areas that meet objective
criteria of economic distress developed by the Secretary of
the Treasury, which may include--
``(i) the percentage of low-income families or the extent
of poverty;
``(ii) the rate of unemployment or underemployment;
``(iii) extent of blight and disinvestment;
``(iv) projects that target extremely low-, very low-, and
low-income families in or outside a designated economic
distress area; or
``(v) any other criteria designated by the Secretary of the
Treasury.
``(3) Leverage of funds.--Each grant from the Capital
Magnet Fund awarded under this section shall be reasonably
expected to result in eligible housing, or economic and
community development projects that support or sustain an
affordable housing project funded by a grant under this
section whose aggregate costs total at least 10 times the
grant amount.
``(4) Commitment for use deadline.--Amounts made available
for grants under this section shall be committed for use
within 2 years of the date of such allocation. The Secretary
of the Treasury shall recapture into the Capital Magnet Fund
any amounts not so used or committed for use and allocate
such amounts in the first year after such recapture.
``(5) Lobbying restrictions.--No assistance or amounts made
available under this section may be expended by an eligible
grantee to pay any person to influence or attempt to
influence any agency, elected official, officer or employee
of a State or local government in connection with the making,
award, extension, continuation, renewal, amendment, or
modification of any State or local government contract,
grant, loan, or cooperative agreement as such terms are
defined in section 1352 of title 31, United States Code.
``(6) Prohibition of consideration of use for meeting
housing goals or duty to serve.--In determining the
compliance of enterprises with the housing goals under this
section and the duty to serve underserved markets under
section 1335, the Secretary of Housing and Urban Development
may not consider any Capital Magnet Fund amounts used under
this section for eligible activities under subsection (f).
The Secretary of Housing and Urban Development shall give
credit toward the achievement of such housing goals and such
duty to serve underserved markets to purchases by the
enterprises of mortgages for housing that receives funding
from Capital Magnet Fund grant amounts, but only to the
extent that such purchases
[[Page S14639]]
by the enterprises are funded other than with such grant
amounts.
``(7) Accountability of recipients and grantees.--
``(A) Tracking of funds.--The Secretary of the Treasury
shall--
``(i) require each grantee to develop and maintain a system
to ensure that each recipient of assistance from the Capital
Magnet Fund uses such amounts in accordance with this
section, the regulations issued under this section, and any
requirements or conditions under which such amounts were
provided; and
``(ii) establish minimum requirements for agreements,
between the grantee and the Capital Magnet Fund, regarding
assistance from the Capital Magnet Fund, which shall
include--
``(I) appropriate periodic financial and project reporting,
record retention, and audit requirements for the duration of
the grant to the recipient to ensure compliance with the
limitations and requirements of this section and the
regulations under this section; and
``(II) any other requirements that the Secretary determines
are necessary to ensure appropriate grant administration and
compliance.
``(B) Misuse of funds.--If the Secretary of the Treasury
determines, after reasonable notice and opportunity for
hearing, that a grantee has failed to comply substantially
with any provision of this section and until the Secretary is
satisfied that there is no longer any such failure to comply,
the Secretary shall--
``(i) reduce the amount of assistance under this section to
the grantee by an amount equal to the amount of Capital
Magnet Fund grant amounts which were not used in accordance
with this section;
``(ii) require the grantee to repay the Secretary an amount
equal to the amount of the amount of Capital Magnet Fund
grant amounts which were not used in accordance with this
section;
``(iii) limit the availability of assistance under this
section to the grantee to activities or recipients not
affected by such failure to comply; or
``(iv) terminate any assistance under this section to the
grantee.
``(i) Periodic Reports.--
``(1) In general.--The Secretary of the Treasury shall
submit a report, on a periodic basis, to the Committee on
Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of
Representatives describing the activities to be funded under
this section.
``(2) Reports available to public.--The Secretary of the
Treasury shall make the reports required under paragraph (1)
publicly available.
``(j) Affordable Housing Trust Fund.--If, after the date of
enactment of the Government Sponsored Enterprise Mission
Improvement Act, in any year, there is enacted any provision
of Federal law establishing an affordable housing trust fund
other than under this title for use only for grants to
provide affordable rental housing and affordable
homeownership opportunities, the Secretary of the Treasury
shall in such year and any subsequent years transfer to that
affordable housing trust fund the aggregate amount allocated
pursuant to this section in such year or years.
Notwithstanding any other provision of law, assistance
provided using amounts transferred to such affordable housing
trust fund pursuant to this subsection may not be used for
any of the activities specified in subsection (h)(5).
``(k) Regulations.--
``(1) In general.--The Secretary of the Treasury shall
issue regulations to carry out this section.
``(2) Required contents.--The regulations issued under this
subsection shall include--
``(A) authority for the Secretary to audit, provide for an
audit, or otherwise verify an enterprise's activities, to
ensure compliance with this section;
``(B) a requirement that the Secretary ensure that the
allocation of each enterprise is audited not less than
annually to ensure compliance with this section; and
``(C) requirements for a process for application to, and
selection by, the Secretary for activities to be funded with
amounts from the Capital Magnet Fund, which shall provide
that--
``(i) funds be fairly distributed to urban, suburban, and
rural areas;
``(ii) selection shall be based upon specific criteria,
including a prioritization of funding based upon--
``(I) the ability to use such funds to generate additional
investments;
``(II) affordable housing need (taking into account the
distinct needs of different regions of the country); and
``(III) ability to obligate amounts and undertake
activities so funded in a timely manner.''.
SEC. 8. ENFORCEMENT.
(a) Cease-and-Desist Proceedings.--Section 1341 of the
Housing and Community Development Act of 1992 (12 U.S.C.
4581) is amended--
(1) by striking subsection (a) and inserting the following
new subsection:
``(a) Grounds for Issuance.--The Secretary may issue and
serve a notice of charges under this section upon an
enterprise if the Secretary determines--
``(1) the enterprise has failed to meet any housing goal
established under subpart B, following a written notice and
determination of such failure in accordance with section
1336;
``(2) the enterprise has failed to submit a report under
section 1314, following a notice of such failure, an
opportunity for comment by the enterprise, and a final
determination by the Secretary;
``(3) the enterprise has failed to submit the information
required under subsection (m) or (n) of section 309 of the
Federal National Mortgage Association Charter Act, or
subsection (e) or (f) of section 307 of the Federal Home Loan
Mortgage Corporation Act;
``(4) the enterprise has violated any provision of this
part or any order, rule, or regulation under this part;
``(5) the enterprise has failed to submit a housing plan
that complies with section 1336(c) within the applicable
period; or
``(6) the enterprise has failed to comply with a housing
plan under section 1336(c).'';
(2) in subsection (b)(2), by striking ``requiring the
enterprise to'' and all that follows through the end of the
paragraph and inserting the following: ``requiring the
enterprise to--
``(A) comply with the goal or goals of this subpart;
``(B) submit a report under section 1314;
``(C) comply with any provision of this part or any order,
rule, or regulation under such part;
``(D) submit a housing plan in compliance with section
1336(c);
``(E) comply with a housing plan submitted under section
1336(c); or
``(F) provide the information required under subsection (m)
or (n) of section 309 of the Federal National Mortgage
Association Charter Act or subsection (e) or (f) of section
307 of the Federal Home Loan Mortgage Corporation Act, as
applicable.'';
(3) in subsection (c), by inserting ``date of the'' before
``service of the order''; and
(4) by striking subsection (d).
(b) Authority of Secretary to Enforce Notices and Orders.--
Section 1344 of the Housing and Community Development Act of
1992 (12 U.S.C. 4584) is amended by striking subsection (a)
and inserting the following new subsection:
``(a) Enforcement.--
``(1) In court.--The Secretary may, in the discretion of
the Secretary, apply to the United States District Court for
the District of Columbia, or the United States district court
within the jurisdiction of which the headquarters of the
enterprise is located, for the enforcement of any effective
and outstanding notice or order issued under section 1341 or
1345, or request that the Attorney General of the United
States bring such an action.
``(2) Court authority.--A court described under paragraph
(1) shall have jurisdiction and power to order and require
compliance with any notice or order issued pursuant to
paragraph (1).''.
(c) Civil Money Penalties.--Section 1345 of the Housing and
Community Development Act of 1992 (12 U.S.C. 4585) is
amended--
(1) by striking subsections (a) and (b) and inserting the
following new subsections:
``(a) Authority.--The Secretary may impose a civil money
penalty, in accordance with the provisions of this section,
on any enterprise that has failed to--
``(1) meet any housing goal established under subpart B,
following a written notice and determination of such failure
in accordance with section 1336(b);
``(2) submit a report under section 1314, following a
notice of such failure, an opportunity for comment by the
enterprise, and a final determination by the Secretary;
``(3) submit the information required under subsection (m)
or (n) of section 309 of the Federal National Mortgage
Association Charter Act, or subsection (e) or (f) of section
307 of the Federal Home Loan Mortgage Corporation Act;
``(4) comply with any provision of this part or any order,
rule, or regulation under this part;
``(5) submit a housing plan pursuant to section 1336(c)
within the required period; or
``(6) comply with a housing plan for the enterprise under
section 1336(c).
``(b) Amount of Penalty.--The amount of a civil money
penalty under subsection (a), as determined by the Secretary,
may not exceed--
``(1) for any failure described in paragraph (1), (5), or
(6) of subsection (a), $50,000 for each day that the failure
occurs; and
``(2) for any failure described in paragraph (2), (3), or
(4) of subsection (a), $20,000 for each day that the failure
occurs.'';
(2) in subsection (c)--
(A) in paragraph (1)--
(i) in subparagraph (A), by inserting ``and'' after the
semicolon at the end;
(ii) in subparagraph (B), by striking ``; and'' and
inserting a period; and
(iii) by striking subparagraph (C); and
(B) in paragraph (2), by inserting after the period at the
end the following: ``In determining the penalty under
subsection (a)(1), the Secretary shall give consideration to
the length of time the enterprise should reasonably take to
achieve the goal.'';
(3) in the first sentence of subsection (d)--
(A) by striking ``request the Attorney General of the
United States to'' and inserting ``, in the discretion of the
Secretary,''; and
(B) by inserting ``, or request that the Attorney General
of the United States bring such an action'' before the period
at the end;
(4) by striking subsection (f); and
[[Page S14640]]
(5) by redesignating subsection (g) as subsection (f).
(d) Enforcement of Subpoenas.--Section 1348(c) of the
Housing and Community Development Act of 1992 (12 U.S.C.
4588(c)) is amended--
(1) by striking ``request the Attorney General of the
United States to'' and inserting ``, in the discretion of the
Secretary,''; and
(2) by inserting ``or request that the Attorney General of
the United States bring such an action,'' after ``District of
Columbia,''.
(e) Conforming Amendment.--The heading for subpart C of
part 2 of subtitle A of title XIII of the Housing and
Community Development Act of 1992 is amended to read as
follows:
``Subpart C--Enforcement''.
______
By Mr. COLEMAN (for himself and Ms. Collins):
S. 2394. A bill to amend the Internal Revenue Code of 1986 to
simplify, modernize, and improve public notice of and access to tax
lien information by providing for a national, Internet accessible,
filing system for Federal tax liens, and for other purposes; to the
Committee on Finance.
Mr. COLEMAN. Mr. President, I rise today to introduce the Good
Government Contractor Act of 2007.
This legislation represents my continuing efforts targeting federal
contractors with tax debt. For several years, as Chair and now as
Ranking Member of the Permanent Subcommittee on Investigations, I have
led a bipartisan Subcommittee effort, with the assistance of the
Government Accountability Office, that has uncovered tens of thousands
of deadbeat civilian and defense contractors.
What we are dealing with here are not everyday tax delinquents, but
rather federal contractors who do not pay their fair share of taxes--
despite receiving billions of dollars from American taxpayers each
year. So far, since PSI began this effort, we have learned that 27,000
Federal contractors at the Department of Defense owed about $3 billion
in unpaid taxes; 33,000 Federal contractors at civilian agencies owed
back taxes amounting to $3.3 billion; 3,800 Federal contractors who
contract with the General Services Administration owe back taxes amount
to $1.4 billion.
These contractors are not just cheating the American taxpayer but in
many cases cheating their own employees by using payroll taxes for
their business or personal use. The Subcommittee has learned of
contractors who have bought luxury cars, boats, and multi-million
dollar properties, even though they owed hundreds of thousands of
dollars in unpaid taxes.
At the end of the day, these contractors are not only shifting the
burden to honest taxpayers but also depriving the Treasury of funds
that could be used to address critical priorities from education to
health care to the fight against terrorism. Accordingly, as part of my
on-going effort to safeguard the interest of the American taxpayer and
honest federal contractors, I am introducing legislation to better
target tax cheating contractors.
More specifically, my legislation will amend the Federal Acquisition
Regulations to consider a responsible contractor as one without any tax
debt; require the Department of Defense, GSA and NASA to issue a final
rule relating to tax delinquency; establish a national electronic tax
lien filing system; create a Federal tax conviction database for the
purposes of verifying contractor tax information; and establish as
cause for debarment or suspension for knowingly making false statements
regarding Federal tax information or prior convictions or civil
judgments for Federal tax evasion or other Federal Tax offenses.
My bill will also repeal the indiscriminant three percent tax
withholding requirement on all contractors, something which the vast
majority of responsible, tax-paying government contractors, as well as
State and local units of government, will appreciate. Last year,
Congress passed into law a well-intentioned but highly problematic
measure establishing a three percent withholding tax on all government
contractors. Section 511 of the Tax Increase Prevention and
Reconciliation Act of 2005 will impose a 3 percent withholding tax on
Federal, State and local payments for goods and services beginning in
2011, except for local governments with annual spending of less than
$100 million for goods and services. While this measure will obviously
capture the bad apples, it unfortunately will also hit honest
contractors--some of whose business livelihoods could well be
jeopardized as a result. Another serious side effect will be the
administrative burden on State and local governments, which could
ultimately heighten the cost of doing business in a much larger sense.
Rather than this broad and cumbersome approach, my Good Government
Contractor Act of 2007 will replace the blanket three percent
withholding requirement with measures focused on just the bad actors.
In closing, my bill will protect taxpayers, State and local
governments, and law-abiding government contractors by holding deadbeat
contractors accountable in a strict but fair way.
Mr. President, I ask unanimous consent that the text of the bill be
printed in the Record.
There being no objection, the text of the bill was ordered to be
printed in the Record, as follows:
S. 2394
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE.
(a) Short Title.--This Act may be cited as the ``Good
Government Contractor Act of 2007''.
(b) Amendment of 1986 Code.--Except as otherwise expressly
provided, whenever in this Act an amendment or repeal is
expressed in terms of an amendment to, or repeal of, a
section or other provision, the reference shall be considered
to be made to a section or other provision of the Internal
Revenue Code of 1986.
SEC. 2. REPEAL OF IMPOSITION OF WITHHOLDING ON CERTAIN
PAYMENTS MADE TO VENDORS BY GOVERNMENT
ENTITIES.
The amendment made by section 511 of the Tax Increase
Prevention and Reconciliation Act of 2005 is repealed and the
Internal Revenue Code of 1986 shall be applied as if such
amendment had never been enacted.
SEC. 3. FAR CONTRACTOR QUALIFICATIONS.
(a) In General.--Not later than 180 days after the date of
the enactment of this Act, the Civilian Agency Acquisition
Council and the Defense Acquisition Regulations Council shall
amend the Federal Acquisition Regulation issued under
sections 6 and 25 of the Office of Federal Procurement Policy
Act (41 U.S.C. 405 and 421) to provide that for a prospective
contractor to be determined responsible, such contractor must
not have any tax debt.
(b) Tax Debt.--For purposes of this section, the term ``tax
debt'' means an outstanding debt under the Internal Revenue
Code of 1986 which has not been paid within 180 days after an
assessment of a tax, penalty, or interest and which is not
subject to further appeal or a petition for redetermination
under such Code. Such term does not include a debt that is
being paid in a timely manner pursuant to an agreement under
section 6159 or section 7122 of such Code.
SEC. 4. FINAL RULE PROMULGATION.
Not later than 180 days after the date of the enactment of
this Act, the Civilian Agency Acquisition Council and the
Defense Acquisition Regulations Council shall make final the
proposed rule FAR Case 2006-011 (Representations and
Certifications--Tax Delinquency).
SEC. 5. NATIONAL TAX LIEN FILING SYSTEM.
(a) Filing of Notice of Lien.--Subsection (f) of section
6323 (relating to validity and priority against certain
persons) is amended to read as follows:
``(f) Filing of Notice; Form.--
``(1) Filing of notice.--The notice referred to in
subsection (a) shall be filed in the national Federal tax
lien registry established under subsection (k). The filing of
a notice of lien, or a certificate of release, discharge,
subordination, or nonattachment of lien, in the national
Federal tax lien registry shall be effective for purposes of
determining lien priority regardless of the nature or
location of the property interest to which the lien attaches.
``(2) Form.--The form and content of the notice referred to
in subsection (a) shall be prescribed by the Secretary. Such
notice shall be valid notwithstanding any other provision of
law regarding the form or content of a notice of lien.
``(3) Other national filing systems.--The filing of a
notice of lien shall be governed by this title and shall not
be subject to any other Federal law establishing a place or
places for the filing of liens or encumbrances under a
national filing system.''.
(b) Refiling of Notice.--Paragraph (2) of section 6323(g)
(relating to refiling of notice) is amended to read as
follows:
``(2) Refiling.--A notice of lien may be refiled in the
national Federal tax lien registry established under
subsection (k).''.
(c) Release of Tax Liens or Discharge of Property.--
(1) In general.--Section 6325(a) (relating to release of
lien) is amended by inserting ``, and shall cause the
certificate of release to be filed in the national Federal
tax lien registry established under section 6323(k),'' after
``internal revenue tax''.
(2) Release of tax liens expedited from 30 to 10 days.--
Section 6325(a) (relating to release of lien) is amended by
striking ``not later than 30 days'' and inserting ``not later
than 10 days''.
[[Page S14641]]
(3) Discharge of property from lien.--Section 6325(b)
(relating to discharge of property) is amended--
(A) by inserting ``, and shall cause the certificate of
discharge to be filed in the national Federal tax lien
registry established under section 6323(k),'' after ``under
this chapter'' in paragraph (1),
(B) by inserting ``, and shall cause the certificate of
discharge to be filed in such national Federal tax lien
registry,'' after ``property subject to the lien'' in
paragraph (2),
(C) by inserting ``, and shall cause the certificate of
discharge to be filed in such national Federal tax lien
registry,'' after ``property subject to the lien'' in
paragraph (3), and
(D) by inserting ``, and shall cause the certificate of
discharge of property to be filed in such national Federal
tax lien registry,'' after ``certificate of discharge of such
property'' in paragraph (4).
(4) Discharge of property from estate or gift tax lien.--
Section 6325(c) (relating to estate or gift tax) is amended
by inserting ``, and shall cause the certificate of discharge
to be filed in the national Federal tax lien registry
established under section 6323(k),'' after ``imposed by
section 6324''.
(5) Subordination of lien.--Section 6325(d) (relating to
subordination of lien) is amended by inserting ``, and shall
cause the certificate of subordination to be filed in the
national Federal tax lien registry established under section
6323(k),'' after ``subject to such lien''.
(6) Nonattachment of lien.--Section 6325(e) (relating to
nonattachment of lien) is amended by inserting ``, and shall
cause the certificate of nonattachment to be filed in the
national Federal tax lien registry established under section
6323(k),'' after ``property of such person''.
(7) Effect of certificate.--Paragraphs (1) and (2)(B) of
section 6325(f) (relating to effect of certificate) are each
amended by striking ``in the same office as the notice of
lien to which it relates is filed (if such notice of lien has
been filed)'' and inserting ``in the national Federal tax
lien registry established under section 6323(k)''.
(8) Release following administrative appeal.--Section
6326(b) (relating to certificate of release) is amended--
(A) by striking ``and shall include'' and insert ``, shall
include'', and
(B) by inserting ``, and shall cause the certificate of
release to be filed in the national Federal tax lien registry
established under section 6323(k),'' after ``erroneous''.
(9) Conforming amendments.--Section 6325 is amended by
striking subsection (g) and by redesignating subsection (h)
as subsection (g).
(d) National Federal Tax Lien Registry.--
(1) In general.--Section 6323 is amended by adding at the
end the following new subsection:
``(k) National Registry.--The national Federal tax lien
registry referred to in subsection (f)(1) shall be
established and maintained by the Secretary and shall be
accessible to and searchable by the public through the
Internet at no cost to access or search. The registry shall
identify the taxpayer to whom the Federal tax lien applies
and reflect the date and time the notice of lien was filed,
and shall be made searchable by, at a minimum, taxpayer name,
the State of the taxpayer's address as shown on the notice of
lien, the type of tax, and the tax period, and, when the
Secretary determines it is feasible, by property. The
registry shall also provide for the filing of certificates of
release, discharge, subordination, and nonattachment of
Federal tax liens, as authorized in sections 6325 and 6326,
and may provide for publishing such other documents or
information with respect to Federal tax liens as the
Secretary may by regulation provide.''.
(2) Administrative action.--The Secretary of the Treasury
shall issue regulations or other guidance providing for the
maintenance and use of the national Federal tax lien registry
established under section 6323(k) of the Internal Revenue
Code of 1986. The Secretary of the Treasury shall take
appropriate steps to secure and prevent tampering with the
data recorded therein. Prior to implementation of such
registry, the Secretary of the Treasury shall review the
information currently provided in public lien filings and
determine whether any such information should be excluded or
protected from public viewing in such registry.
(e) Transition Rules.--The Secretary of the Treasury may by
regulation prescribe for the continued filing of notices of
Federal tax lien in the offices of the States, counties and
other governmental subdivisions after December 31, 2008, for
an appropriate period to permit an orderly transition to the
national Federal tax lien registry established under section
6323(k) of the Internal Revenue Code of 1986.
(f) Effective Date.--The amendments made by this section
shall apply to notices of lien filed after December 31, 2008.
The national Federal tax lien registry (established under
section 6323(k) of the Internal Revenue Code of 1986) shall
be made operational as of January 1, 2009, whether or not the
Secretary of the Treasury has promulgated final regulations
establishing such registry.
SEC. 6. FEDERAL TAX CONVICTION DATABASE.
(a) In General.--The Attorney General of the United States
shall establish and maintain a database containing the names
of individuals and entities with convictions for Federal tax
offenses under the Internal Revenue Code of 1986. Such
database shall be accessible and searchable by the head of
any Federal agency for purposes of verifying information
provided by prospective contractors.
(b) Administrative Action.--The Attorney General shall
issue regulations or other guidance providing for the
maintenance and use of the database established under
subsection (a). The Attorney General shall take appropriate
steps to secure and prevent tampering with the data recorded
therein.
SEC. 7. REQUIRED ACCESS TO REGISTRY AND DATABASE.
Not later than 180 days after the date of the enactment of
this Act, the Civilian Agency Acquisition Council and the
Defense Acquisition Regulations Council shall amend the
Federal Acquisition Regulation issued under sections 6 and 25
of the Office of Federal Procurement Policy Act (41 U.S.C.
405 and 421) to require a contracting officer making a
determination of responsibility with respect to any
prospective contractor to access the national Federal tax
lien registry established under section 6323(k) of the
Internal Revenue Code of 1986 and the Federal tax conviction
database established under section 6 of this Act.
SEC. 8. CAUSES FOR DEBARMENT AND SUSPENSION.
Not later than 180 days after the date of the enactment of
this Act, the Civilian Agency Acquisition Council and the
Defense Acquisition Regulations Council shall amend the
Federal Acquisition Regulation issued under sections 6 and 25
of the Office of Federal Procurement Policy Act (41 U.S.C.
405 and 421)--
(1) to provide as a cause for either contractor debarment
or suspension the knowingly making of false statements
regarding Federal tax information, including on the Online
Representations and Certifications Application or to the
Central Contractor Registry, incurring a tax debt (as defined
in section 3(b)), or the conviction or imposition of a civil
judgment for the commission of Federal tax evasion or any
other Federal tax offense, and
(2) to require the debarring official or suspending
official to provide a statement of explanation for the
nondebarment or non-suspension of any contractor in any
determination involving any cause for debarment or suspension
described in paragraph (1).
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By Mrs. CLINTON (for herself and Mr. Rockefeller):
S. 2395. A bill to establish an adoption process improvement pilot
program; to the Committee on Health, Education, Labor, and Pensions.
Mrs. CLINTON. Mr. President, I am here today to introduce legislation
in honor of National Adoption Day that will address the needs of
children waiting to be adopted from our Nation's foster care system.
These are children who are unable to return home to their natural
parents and are in need of permanent, loving, adoptive homes. In recent
years, Congress has acted to implement supports for this population by
creating programs that allow states to pursue creative and innovative
methods for increasing foster care adoptions. However, today, tens of
thousands of children are still waiting for families. There is still
more work to be done.
According to current federal estimates, there are 114,000 children in
foster care with the goal of adoption. Of these, only 13 percent are
living in a pre-adoptive home. Moreover, each year in the public child
welfare system, more children are made eligible for adoption than find
permanent adoptive homes. For example, in fiscal year 2005--the most
recent year for which statistics are available--states finalized 15,000
more terminations of parental rights than adoptions. Taken together,
these statistics describe a tremendous pool of children lingering in
foster care, waiting for a ``forever family.'' We know the longer
children languish in foster care, the more they are at risk for
developing a range of psychological, behavioral, and educational
problems. Therefore, permanence for these children is essential.
Child welfare professionals across the country lament a lack of
adoptive families for children in foster care. However, an untapped
resource exists. A recent study conducted by the Evan B. Donaldson
Adoption Institute in collaboration with Harvard University and the
Urban Institute notes that, in a given year, 240,000 people will call
for information about adopting a child from foster care, but only a
fraction will see the process through to adoption. This research states
that prospective parents are often alienated from the adoption process
at an early stage; these individuals experience unpleasant initial
contacts and report difficulty in navigating the adoption process. Out
of frustration, they abandon their pursuit of bringing a foster child
permanently into their home.
[[Page S14642]]
Therefore, I am pleased to introduce the Adoption Improvement Act of
2007. This legislation establishes funding for a demonstration project
aimed at reducing the attrition of prospective parents from the
adoption process. Participating states will implement a rigorous
program that strengthens the first contact prospective adopters have
when they make that critical, initial inquiry into adopting a child.
The bill calls on programs to include a specialized adoption hotline;
hire employees who are trained to respond to callers' requests
sensitively and efficiently; and incorporate the input of parents who
have already adopted children from foster care. In addition, programs
will provide explicit information to parents about how to make their
way through the various adoption procedures; describe the rewards and
challenges of the adoption process; and establish a buddy system that
partners prospective parents with those who have already adopted foster
children successfully. Finally, all agencies in the demonstration
project will participate in a thorough program evaluation.
This month is National Adoption Month, and tomorrow, November 17,
2007, is National Adoption Day--a day to celebrate the families that
have already been joined through adoption, and to call attention to the
thousands of children still waiting for permanent homes. I am delighted
to join Senators Landrieu and Coleman in their forthcoming resolution
acknowledging the importance of National Adoption Month and National
Adoption Day. I encourage my colleagues in Congress to take the
messages of this resolution and my bill with them, beyond just this
November, into the future.
The national data compel us to take action. Too many children in our
Nation's foster care system are in desperate need of stable, loving
homes, and there are thousands of potential parents out there yearning
to provide them. I would like to thank my colleague Senator Rockefeller
for joining me in this important effort. Please join me in bringing
these groups together so that children in foster care can find the
families they deserve.
______
By Mr. HATCH (for himself, Mr. Rockefeller, Mr. Lott, and Mr.
Kennedy):
S. 2396. A bill to amend title XI of the Social Security Act to
modernize the quality improvement organization (QIO) program; to the
Committee on Finance.
Mr. HATCH. Mr. President, today I join with Senators Rockefeller,
Lott, and Kennedy to introduce the Medicare Quality Improvement
Modernization Act of 2007, S. 2396.
As background for my colleagues, Medicare's Quality Improvement
Organization, QIO, program has been in existence for 35 years. The
program's intent has always been to assure that Medicare's
beneficiaries receive high quality medical care. The program has
undergone a steady evolution. What began as a program that called
attention to hospitals and physicians whose care deviated from the
norms of medical practice has morphed into one that seeks to help
physicians, hospitals, nursing homes and other providers develop
systems to improve their quality of care.
The program has changed as the definition of quality changed. When
Medicare's peer review program was initiated, high quality care for a
Medicare beneficiary was simply not to be among the unfortunate few
whose medical care deviated from the norms of local medical practice.
Fortunate for them, however, quality today is the routine adherence of
providers to nationally accepted standards of care.
The legislative changes we propose for the QIO program reflects an
ever-advancing definition of quality medical care and a focus on
helping providers obtain it.
The QIO program has three functions. First, the program reviews the
medical care of beneficiaries who have complaints about their care and
provides the beneficiaries opinions. Second, the program supports
intensive work with practitioners, nursing homes, managed care plans
and hospitals to develop delivery systems that improve the quality of
their care. Third the program publicly reports system-level performance
measures.
The bill I introduce today is faithful to the results of a
congressionally-mandated review of the QIO program reported in
February, 2006. In that review, the IOM concluded ``The QIO program
provides a potentially valuable nationwide infrastructure dedicated to
promoting quality health care.'' For example, the QIO program is
responsible for a substantial part of the National Healthcare Quality
Report published by the Agency for Healthcare Research and Quality.
The IOM report called for changes in the QIO program. Its principal
findings and recommendations were that the local QIO boards are heavily
physician-dominated with little consumer representation. Existing
legislation requires specific levels of physician involvement, an
outmoded board structure.
Also, the QIO functions should be harmonized with other federal
quality Initiatives.
It found that the QIOs were ``. . . restricted from contracting with
health care providers in its state for technical assistance or review
services similar to those covered by its core Medicare contract.'' The
IOM committee concluded that QIOs would be able to serve more providers
and expand their function beyond Medicare beneficiaries to the
entire healthcare system if they could contract for services to
supplement their CMS funds.
The Committee also recommended removal of restrictions on public
access to the QIO's findings. For instance, beneficiaries have been
unable to review the results of investigations that they requested.
The IOM recommended that beneficiary reviews be removed from the
local QIOs.
The IOM committee concluded that Congress and the secretary of DHHS
and CMS should improve program management by enhancing the contracting
process and improving communication with the QIOs.
The legislation I propose seeks to strengthen the QIO's
infrastructure to fit with an ever-tightening standard of quality in
medicine, believing that doctors and hospitals want to do the right
thing but also that patients should have their say.
Many of the changes recommended by the Institute of Medicine's
experts and accepted by the experts at CMS do not require statutory
change, but some do. Some program modifications are sufficiently
critical to Medicare's beneficiaries, that while statutory language may
not be required to affect them, a Congressional mandate is needed to
assure them.
First, the Quality Improvement Organization Modernization Act of 2007
specifies that the Quality Improvement Organizations offer education,
instruction, and technical assistance to providers, practitioners, and
Medicare Advantage plans. It incorporates plans and providers in urban,
rural, and frontier areas and providers that treat racial and ethnic
minorities.
Second, our bill strengthens the review process for individual
Medicare beneficiaries. The QIOs must actively educate beneficiaries of
their right to bring any concerns to the QIOs. The QIOs must work with
providers who are reviewed to correct deficiencies where they exist and
to improve communication with patients where they do not.
The bill specifies that the findings of the review must be disclosed
to the beneficiary requesting the review but not before giving the
provider an opportunity to respond to the findings. The review
functions are left with the local QIOs and not delegated to other
entities to perform.
The bill specifies that the findings of reviews may not be used in
medical malpractice litigation, otherwise the QIOs would serve more to
screen cases for litigation than they would to improve the quality of
care.
Third, in order to be certain that the QIOs are appropriately judging
the severity of the errors they find and appropriately recommending
sanctions to the Secretary, the Office of Inspector General will
contract for an audit of 10 percent of one year's QIO reviews during
each 5-year contract period.
Fourth, program administration is strengthened and its goals focused.
The program's scope of work must incorporate the priorities of local
stakeholders.
A strategic advisory committee will advise the Secretary on program
goals, on program performance, and on harmonization of the QIO's
quality functions with other federal and non-federal quality
initiatives.
[[Page S14643]]
The GAO is instructed to report on implementation of program changes
1 year after the first 5-year contract period following enactment of
this legislation. The adequacy of funding allocated to the QIOs for
local initiatives has been in dispute among the QIOs. Congress is to
receive an independent report about the adequacy of QIO financing
before the initiation of each contract period.
The contracting process is strengthened by mandating timely
contracting with the QIOs by CMS and by lengthening the contract period
from 3 to 5 years. All QIOs must bid competitively every 5 years.
Fifth, local boards have been physician-dominated with little
consumer representation. Our bill eliminates the requirement that QIOs
must be physician sponsored organizations. Our bill improves local QIO
accountability by strengthening the authority of the Secretary over
board structure and function. It authorizes the Secretary to ensure
that non-physician quality experts and qualified consumers are given
appropriate representation on state QIO boards. It authorizes the
Secretary to ensure that the board structure is appropriate, that the
compensation of board members and executives is market-based and that
conflict of interest among board members is mitigated.
Sixth, as the QIOs focus more of their energies on working with
providers to improve quality the demand for their services in this
endeavor exceed their resources. For example, the number of doctors
requesting help from the Utah QIO in selecting information technology
for their offices far exceeds the resources available to it from its
CMS contract.
Our bill allows a QIO to contract with a provider or organization if
it meets one of several requirements. Among them are that the QIO must
receive no more than 5 percent of its revenue from a single provider or
organization, or if the contracting organization is subject to review
by the QIO, conflict of interest must be mitigated by using an out-of-
state QIO to perform the reviews that the local QIO would otherwise
perform.
The QIO program differs from other Federal health care quality
programs in that it does not just measure quality; it works with
providers to attain it. The Medicare Quality Improvement Organization
Act of 2007 strengthens the rights of beneficiaries, strengthens the
administration of the program and the contracting process, provides for
more accountability of contractors, and focuses the program on creating
quality systems.
I urge my colleagues to join with me in strengthening the QIO
program. It is one of the cornerstones of the quality initiative not
just for Medicare but for all Americans.
______
By Mr. LEAHY (for himself, Mr. Cochran, and Mr. Dodd):
S.J. Res. 25. A joint resolution providing for the appointment of
John W. McCarter as a citizen regent of the Board of Regents of the
Smithsonian Institution; to the Committee on Rules and Administration.
Mr. LEAHY. Mr. President, I ask unanimous consent that the text of
the joint resolution be printed in the Record.
There being no objection, the text of the joint resolution was
ordered to be printed in the Record, as follows:
S.J. Res. 25
Resolved by the Senate and House of Representatives of the
United States of America in Congress assembled, That, in
accordance with section 5581 of the Revised Statutes (20
U.S.C. 43), the vacancy on the Board of Regents of the
Smithsonian Institution, in the class other than Members of
Congress, occurring because of the expiration of the term of
Walter E. Massey of Georgia, is filled by the appointment of
John W. McCarter of Illinois, for a term of 6 years,
effective on the date of the enactment of this resolution.
____________________